The European Central Bank left its key interest rates unchanged at its July meeting, following a 25bp increase in June, the first rate hike in three years, driven by rising energy prices and persistent inflationary pressures. Since then, softer inflation, wage growth, economic activity, and inflation expectations have reduced the urgency for another move, prompting policymakers to adopt a cautious, data-dependent "wait-and-see" approach. The ECB said the outlook for energy prices remains broadly in line with its June projections despite continued volatility, while warning that uncertainty remains high and the full inflationary impact of the energy shock has yet to emerge. Policymakers also noted they will continue to monitor its broader effects on inflation and the economy. At the post-meeting press conference, ECB President Lagarde warned that the longer energy prices remain elevated, "the more likely they are to drive up broader inflation through indirect and second-round effects."

Futures tracking US equity indices fell for a second session on Thursday amid a deteriorating macroeconomic backdrop and fresh AI doubt on the latest earnings reports. Contracts for the S&P 500 and Dow dropped 0.5%, while those for the Nasdaq 100 fell over 1%. Alphabet dropped 5% premarket after posting its Q2 results overnight. The Google parent raised its capital expenditure forecast to $205 billion this, double of last year, to reignite concerns of unsustainable spending in AI infrastructure. Meanwhile, Tesla slipped 6% after reporting lower profits despite a strong period for the overall electric vehicle sector. Meanwhile, higher fuel prices lifted yields on greater escalation between Iran and the US, driving markets to position for a rate hike by this quarter. Financials remained under pressure with capital markets firms down. Among other earnings, Comcast and RTX were both higher topping their estimates.

The yield on the US 10-year Treasury note continued to climb to 4.71% on Thursday, rising for a fourth consecutive session to its highest level since January 2025, as surging oil prices and escalating geopolitical tensions fueled expectations that the Fed will need to raise interest rates. Markets are now pricing in a more than 33% chance of a rate hike next week, while the probability of a September increase has climbed above 78%, up from 61% a day earlier. Hostilities in the Middle East continue to intensify, with no signs of a near-term resolution. As a result, oil prices have surged nearly 31% above their pre-conflict levels seen earlier this month. Although inflationary pressures have remained relatively contained so far, the latest spike in energy prices has renewed concerns that higher oil costs could feed into broader inflation, prompting the Fed to maintain a tighter monetary policy stance.

Mexico's economic activity rose 1.1% year-on-year in May 2026, matching forecasts but easing from an upwardly revised 2.6% increase in April. The primary sector led growth, expanding 7.6% as agricultural output increased 8.7% and livestock production rose 5.0%. The tertiary sector advanced 1.7%, driven by wholesale trade (8.8%), government activities (4.9%), healthcare and social services (2.9%), and financial services and insurance (2.6%). Meanwhile, the secondary sector contracted 0.7%, as declines in manufacturing (-1.5%), utilities (-0.9%), and construction (-0.3%) outweighed a 3.9% increase in mining. On a monthly basis, economic activity fell 0.3% after rising 1.4% in April.

The number of people claiming unemployment benefits in the US fell sank by 22,000 to 187,000 on the week to July 18th, well under expectations that it would increase to 212,000, for the lowest claim count in nearly 60 years. Continuing claims, which are seen as a gauge of outstanding unemployment in the US, fell by 2,000 to 1,796,000 on the previous week following an aggressive downward revision to the first period of July. The data continued to reflect a strong labor market in the US, aligned with statements from FOMC members that see the US economy in full employment. Meanwhile, initial claims filed by federal employees, which have been under scrutiny due the administration's efforts in decreasing the number of public workers, rose by 46 to 470.

The Chicago Fed National Activity Index (CFNAI) rose to -0.02 in June 2026 from -0.19 in May, signaling a modest improvement in US economic activity. Two of the four broad categories made negative contributions to the index. The production-related category contributed -0.05, down from -0.03 in May, while employment-related indicators remained unchanged at -0.04. In contrast, the sales, orders, and inventories category improved to +0.01 from -0.09, and the personal consumption and housing category rose to +0.05 from -0.03. Meanwhile, the three-month moving average of the index (CFNAI-MA3) increased to -0.05 in June from -0.10 in May.