EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.14% against the USD and closed at 1.3724.
The US Dollar gained ground on the heels of the release of the Fed’s latest announcement regarding monetary policy. While the Fed maintained the pace of its asset purchases at $85 billion a month as was widely expected, the accompanying statement was observed by traders as less dovish than anticipated. The statement from the Fed’s monetary policy committee largely excluded any reference to the recent government shutdown and omitted previous remarks suggesting that tightening financial conditions could slow the pace of improvement in the economy and labor market.
Ahead of the Fed statement, a slew of economic reports reinforced expectations that the central bank will keep its stimulus program intact for the foreseeable future. Payroll processor ADP reported that private sector employment in the US rose by less than expected in October, while a separate report from the US Labour Department showed a modest increase in consumer prices that matched market estimates, suggesting that inflation pressure remains subdued.
Elsewhere, in the Euro-zone, an official report showed that consumer confidence in the region rose to a level of -14.5 in October, at par with analysts’ expectation and compared to a reading of -14.9 witnessed in the previous month. Another report revealed that the region’s economic sentiment indicator advanced to a reading of 97.8 in October, more than analysts’ call for a rise to 97.3 from previous month’s reading of 96.9. Meanwhile, on a seasonally adjusted basis, Germany’s unemployment rate rose to 6.9%, in line with market estimates and compared to a similar rise seen in the earlier month. However, consumer price index in Germany declined 0.2% (MoM) in October, defying market consensus for a reading of 0.0%.
In the Asian session, at GMT0400, the pair is trading at 1.3710, with the EUR trading 0.10% lower from yesterday’s close.
The pair is expected to find support at 1.3676, and a fall through could take it to the next support level of 1.3641. The pair is expected to find its first resistance at 1.3765, and a rise through could take it to the next resistance level of 1.3819.
Later today, the Euro-zone is scheduled to release a report on its consumer price index, which the market expects to rise 1.1% (YoY) in October, similar to previous month’s rise.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
