EUR/USD: Germany’s trade surplus narrowed more-than-expected in August


EURUSD Movement

For the 24 hours to 23:00 GMT, the EUR rose 0.20% against the USD and closed at 1.1007.

On the macro front, Germany’s seasonally adjusted trade surplus narrowed more than expected to €18.1 billion in August. In the prior month, the nation had recorded a revised surplus of €20.5 billion in the prior month.

The European Central Bank’s (ECB) monetary policy meeting minutes showed that one third of policymakers disagreed on the decision for reviving bond purchase programme in the latest meeting, leading to a difference of opinion between the central bank members as well as posing as a threat to the effectiveness of the policy. Further, the minutes confirmed the appointment of the former IMF chief, Christine Lagarde as the ECB President, succeeding Mario Draghi with effect from 1 November 2019.

In the US, data showed that the US consumer price index (CPI) advanced 1.7% on an annual basis in September, less than market expectations for a rise of 1.8%. In the prior month, the CPI had registered a similar rise. Moreover, the nation’s seasonally adjusted initial jobless claims declined to a level of 210.0K on a weekly basis in the week ended 05 October 2019, more than market anticipation for a fall to a level of 219.0K. In the previous week, initial jobless claims had recorded a revised level of 220.0K.

In the Asian session, at GMT0300, the pair is trading at 1.1017, with the EUR trading 0.09% higher against the USD from yesterday’s close.

The pair is expected to find support at 1.0989, and a fall through could take it to the next support level of 1.0960. The pair is expected to find its first resistance at 1.1040, and a rise through could take it to the next resistance level of 1.1062.

Going ahead, traders would await Germany’s CPI for September, set to release in a few hours. Later in the day, the US Michigan consumer sentiment index for October, will be on traders’ radar.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

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