EUR/USD: Euro-zone’s economy expanded as estimated in 3Q 2018


EURUSD Movement

For the 24 hours to 23:00 GMT, the EUR rose 0.32% against the USD and closed at 1.1414 on Friday.

Macroeconomic data indicated that the Euro-zone’s seasonally adjusted final gross domestic product (GDP) climbed 0.2% on a quarterly basis in 3Q 2018, meeting market expectations and confirming the preliminary print. In the previous month, GDP had recorded an advance of 0.4%. Separately, in Germany, seasonally adjusted industrial production unexpectedly declined 0.5% on a monthly basis in October, cofounding market expectations for a gain of 0.3%. In the prior month, industrial production had registered a revised rise of 0.1%.

The US dollar declined against a basket of currencies, as weaker than expected US jobs data raised doubts over the Federal Reserve’s future interest rate path.

In the US, data showed that the US non-farm payrolls dropped more than expected by 155.0K in November, following a revised increase of 237.0K in the preceding month. Market participants had envisaged non-farm payrolls to fall to a level of 198.0K. However, average hourly earnings of all employees climbed 0.2% on a monthly basis in November, undershooting market expectations for a gain of 0.3%. Average hourly earnings of all employees had registered a revised rise of 0.1% in the previous month. Moreover, consumer credit registered a more-than-expected rise of $25.4 billion in October. In the previous month, consumer credit had climbed $10.9 billion. Meanwhile, the nation’s unemployment rate remained unchanged at a rate of 3.7% in November, in line with market expectations. Also, the flash Reuters/Michigan consumer sentiment index remained steady at 97.5 in December.

In the Asian session, at GMT0400, the pair is trading at 1.1431, with the EUR trading 0.15% higher against the USD from Friday’s close.

The pair is expected to find support at 1.1380, and a fall through could take it to the next support level of 1.1328. The pair is expected to find its first resistance at 1.1463, and a rise through could take it to the next resistance level of 1.1494.

Moving ahead, traders would closely monitor the Euro-zone’s Sentix investor confidence index for December, along with Germany’s trade balance data for October, set to release in a few hours. Later in the day, the US JOLTS job openings for October will be on investor’s radar.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

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