EUR/USD trades quietly at the start of the week around 1.0440 in Monday’s European session. The major currency pair trades in a limited range amid thin trading volume in a holiday-shortened week due to Christmas Eve and Boxing Day on Wednesday and Thursday, respectively.
The US Dollar (USD) steadies on Monday after a sharp sell-off on Friday that was triggered by slower-than-expected growth in the United States (US) Personal Consumption Expenditure Price Index (PCE). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, wobbles below 108.00.
Core PCE inflation, which is the Federal Reserve’s (Fed) preferred inflation gauge, rose steadily by 2.8% but slower than estimates of 2.9%. Month-on-month, headline, and core PCE inflation grew marginally by 0.1%, which raised some uncertainty over whether the Fed will follow a shallow rate-cut path in 2025.
Fed policymakers see the central bank delivering fewer interest rate cuts next year amid a slowdown in the disinflation process and the uncertainty over the impact on the economy of incoming immigration, trade, and tax policies by President-elect Donald Trump.
Cleveland Fed President Beth Hammack, the only official who voted for leaving interest rates unchanged in the policy meeting last Wednesday, said on Friday that she prefers to hold interest rates steady "until the Fed gets further evidence that inflation is resuming its path to its 2% objective,” Reuters reported.
On Friday, Chicago Fed President Austan Goolsbee told in an interview with CNBC that the uncertainty over Trump’s policies after taking office compelled him to project fewer interest rate cuts for 2025 while he had previously anticipated a 100-basis points (bps) interest rate reduction.
Monday’s economic calendar is light. On Tuesday, investors will focus on the US Durable Goods Orders data for November. Economists expect orders to have declined by 0.4% after a 0.3% increase in October.
EUR/USD holds the key support of 1.0350. However, the outlook of the major currency pair remains strongly bearish as all short-to-long-term Exponential Moving Averages (EMAs) are declining.
The 14-day Relative Strength Index (RSI) bounces back to near 40.00. A fresh downside momentum could trigger if the oscillator fails to sustain above that level.
Looking down, the asset could decline to near the round-level support of 1.0200 after breaking below the two-year low of 1.0330. Conversely, the 20-day EMA near 1.0500 will be the key barrier for the Euro bulls.
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
© 2000-2024. Bản quyền Teletrade.
Trang web này được quản lý bởi Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).
Thông tin trên trang web không phải là cơ sở để đưa ra quyết định đầu tư và chỉ được cung cấp cho mục đích làm quen.
Giao dịch trên thị trường tài chính (đặc biệt là giao dịch sử dụng các công cụ biên) mở ra những cơ hội lớn và tạo điều kiện cho các nhà đầu tư sẵn sàng mạo hiểm để thu lợi nhuận, tuy nhiên nó mang trong mình nguy cơ rủi ro khá cao. Chính vì vậy trước khi tiến hành giao dịch cần phải xem xét mọi mặt vấn đề chấp nhận tiến hành giao dịch cụ thể xét theo quan điểm của nguồn lực tài chính sẵn có và mức độ am hiểu thị trường tài chính.
Sử dụng thông tin: sử dụng toàn bộ hay riêng biệt các dữ liệu trên trang web của công ty TeleTrade như một nguồn cung cấp thông tin nhất định. Việc sử dụng tư liệu từ trang web cần kèm theo liên kết đến trang teletrade.vn. Việc tự động thu thập số liệu cũng như thông tin từ trang web TeleTrade đều không được phép.
Xin vui lòng liên hệ với pr@teletrade.global nếu có câu hỏi.