US markets had a rather indifferent session yesterday touching one week lows at one point after comments from non-voting FOMC member and St. Louis Fed chief James Bullard suggested, in a manner befitting Bank of England Governor Mark Carney, that US markets were underestimating the timing of potential Fed rate hikes. He went on to say that they could come by the end of Q1 next year. His reasoning was that the US job market was "way ahead of schedule" toward a normal situation, and that inflation was starting to move higher. The sunny and somewhat misplaced optimism of the post GDP rally also appears to have dissipated somewhat after consumer spending rose less than expected. The savings rate also rose to its highest level since last September which suggest that the US consumer remains cautious and doesn’t really reflect a wider optimism, despite this week’s positive consumer confidence number. The gradual pullback from the lows suggest that markets may be dismissing Bullard's comments given his non-voting status, but they seemed to have missed the point that he will be a voting member next year, so his views are important in that sense, in the timing of any rate rise. As we come to the end of the week Europe's markets look set to open slightly higher this morning, but over the week they've performed poorly, weighed down by concerns about the wider economy, as well as geopolitical tensions, as Q2 data continues to disappoint, particularly in France, which yesterday saw its unemployment levels rise to new record highs. Today's final revision for French Q1 GDP is expected to be confirmed at 0%, with the distinct probability, as we come to the end of June, that Q2 will be little better, and probably worse capping a miserable week for French President Hollande, as the country grapples with an air traffic controllers strike, which is hardly likely to help productivity in the long term. In Germany the latest CPI inflation numbers are expected to show a modest rise in June, rising from 0.6% to 0.7%, reinforcing German concerns that this month’s actions by the ECB were premature in the context of preventing deflation. In the wake of yesterday's formalisation of the macro prudential measures by the Bank of England to limit lending with respect to the housing market, we also get to see the final revision for UK Q1 GDP which is in stark contrast to the numbers coming out of Europe and is expected to be confirmed at 0.8%, though some have suggested it could come in at 0.9%. Business investment is expected to remain unchanged at 2.7%, but it would be positive if it were revised higher. On the downside the current account balance is expected to remain massively in deficit, though not by as much as previously coming in from £22.4bn to £17.3bn. EURUSD – the price action continues to compress below the broader resistance below 1.3670, but above last Friday's low at 1.3560. Only a move beyond 1.3675 argues for a move back towards 1.3780. We also have key trend support from the 2012 lows at 1.2045, which now comes in just above 1.3465. GBPUSD – the pound continues its attempts to push higher, closing above the 1.7000 level again. The risk remains for a move towards 1.7330 the 50% retracement of the decline from the 2007 highs at 2.1160 and the lows at 1.3500 in 2009. Ideally we need to see a monthly close above 1.7000 for this to unfold. Only a move below 1.6910 support delays the scenario above. A drop below 1.6910 sees major support all the way back at the 100 day MA at 1.6725. EURGBP – the attempts to push through 0.8035 have thus far failed this week, and we could well see a drift back towards the recent lows at 0.7960. We need to push through 0.8035 to target 0.8085.The pressure remains on the downside while we remain below trend line resistance from the March highs sitting just below the 0.8110 level, with a longer term target at 0.7880. USDJPY – another failed attempt to push below the 200 day MA support at 101.60 took place yesterday and as such we still remain in the range, with a move back through the 200 day MA needed to retarget the range trade lows of this month near 101.00. The range highs remain anywhere below the 103 00 area and last weeks high at 102.75. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.