EUR/USD: Euro trading on a stronger footing, after EU leaders reach a deal on migration


EURUSD Movement

For the 24 hours to 23:00 GMT, the EUR rose 0.03% against the USD and closed at 1.1564.

The ECB, in its economic bulletin, signalled downside risks to the global growth and confirmed the end of asset purchases.

Macroeconomic data indicated that Euro-zone’s final consumer confidence index eased to its lowest level since October 2017 to -0.5 in June, confirming the preliminary print and in line with market expectations. In the prior month, the index recorded a level of 0.2. Additionally, the region’s business climate indicator declined to a level of 1.39 in June, following a revised reading of 1.44 in the previous month. Market had anticipated for a fall to a level of 1.4.

Moreover, nation’s economic sentiment indicator fell to a 10-month low level of 112.3 in June, higher than market expectations of a fall to a level of 112.0. The indicator had recorded a reading of 112.5 in the preceding month.

Separately, Germany’s Gfk consumer confidence remained unchanged at 10.7 in July, compared to market expectations for a drop to a level of 10.6. Meanwhile, the nation’s flash consumer price index (CPI) recorded a rise of 2.1% on an annual basis in June, less than market expectations for an advance of 2.2%. In the prior month, the CPI had advanced 2.2%.

In the US, data showed that the final annualised gross domestic product (GDP) was revised down to 2.0% in the first quarter of 2018, oppressed by weakest consumer spending in last 5-years, while markets had envisaged for a rise of 2.2%. The GDP had registered a rise of 2.9% in the previous quarter.

On the contrary, the nation’s seasonally adjusted initial jobless claims jumped to a level of 227.0K in the week ended 23 June, higher than market expectations of a rise to 220.0 K. In the previous week, initial jobless claims had recorded a reading of 218.0K.

In the Asian session, at GMT0300, the pair is trading at 1.1648, with the EUR trading 0.73% higher against the USD from yesterday’s close, after the European leaders clinched a deal on migration.

The pair is expected to find support at 1.1567, and a fall through could take it to the next support level of 1.1485. The pair is expected to find its first resistance at 1.1690, and a rise through could take it to the next resistance level of 1.1731.

Moving forward, investors would await the release of Euro-zone’s consumer price index for June along with Germany’s retail sales for May and unemployment rate for June, slated to release in a few hours. Also, the US personal spending and personal income for May as well as the Chicago PMI and the Michigan consumer sentiment index both for June, will keep investors on their toes.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

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