EURUSD: PCE week
During the previous week the FOMC meeting minutes were released from the Fed's latest meeting, revealing both positive and negative topics for market participants. On a positive side was the opinion of FOMC members that monetary measures taken during the previous period are giving the results in the real economy and slowing down the inflation. On a negative side is that there is still no confidence that the inflation is clearly on the path toward the 2.0% target. In this sense, there are no clear signs of a potential Fed's first rate cut during the course of this year.
German HCOB Manufacturing PMI Flash for February was released at level of 42.3, a bit lower from market expectation of 46.1. Inflation rate in the Euro Zone ended in a negative territory of -0.4% on a monthly basis in January, while core inflation was standing at 3.3% on a yearly basis. Both figures were in line with previous estimates. Final inflation rate for January was also unchanged at a level of 2.8% y/y. German GDP growth rate final for Q4 was standing at -0.2% compared to the year before, while the same indicator on a quarterly basis was -0.3% without change from the previous estimate. The Ifo Business climate for Germany in February was standing at 85.5 in line with the forecast.
The currency pair started the previous week around level of 1.076, while the rest of the week it spent with a clear uptrend. The highest weekly level reached was 1.088, however, it soon reverted back, ending the week at level of 1.0818. The RSI was moved up to the level of 50, however, there is no clear indication that the market started its move toward the overbought side. Moving averages of 50 and 200 days are still moving as two parallel lines, without a signal on a potential cross in the coming period.
During the previous week the currency pair clearly broke the 1.08 resistance line. Still, there has not been market strength to push eurusd to higher grounds. Considering that the week ahead is bringing a release of the PCE data, a Fed's favorite gauge for inflation, some increased volatility might be in store. Charts are currently showing some probability for a quite a short reversal of the currency pair toward levels below 1.08 support line. Still, there is equal probability that the currency pair might make a move toward the higher grounds, but not above the 1.09 level.
Important news to watch during the week ahead are:
Euro: GfK Consumer Confidence for March for Germany, Unemployment rate for February for Germany, Inflation Rate preliminary for February for Germany, Inflation Rate for February for Euro Zone,
USD: Durable Goods Orders for January, CB Consumer Confidence for February, GDP Growth rate second estimate for Q4, PCE Price Index for January, ISM Manufacturing PMI for February, Michigan Consumer Sentiment Final for February
German HCOB Manufacturing PMI Flash for February was released at level of 42.3, a bit lower from market expectation of 46.1. Inflation rate in the Euro Zone ended in a negative territory of -0.4% on a monthly basis in January, while core inflation was standing at 3.3% on a yearly basis. Both figures were in line with previous estimates. Final inflation rate for January was also unchanged at a level of 2.8% y/y. German GDP growth rate final for Q4 was standing at -0.2% compared to the year before, while the same indicator on a quarterly basis was -0.3% without change from the previous estimate. The Ifo Business climate for Germany in February was standing at 85.5 in line with the forecast.
The currency pair started the previous week around level of 1.076, while the rest of the week it spent with a clear uptrend. The highest weekly level reached was 1.088, however, it soon reverted back, ending the week at level of 1.0818. The RSI was moved up to the level of 50, however, there is no clear indication that the market started its move toward the overbought side. Moving averages of 50 and 200 days are still moving as two parallel lines, without a signal on a potential cross in the coming period.
During the previous week the currency pair clearly broke the 1.08 resistance line. Still, there has not been market strength to push eurusd to higher grounds. Considering that the week ahead is bringing a release of the PCE data, a Fed's favorite gauge for inflation, some increased volatility might be in store. Charts are currently showing some probability for a quite a short reversal of the currency pair toward levels below 1.08 support line. Still, there is equal probability that the currency pair might make a move toward the higher grounds, but not above the 1.09 level.
Important news to watch during the week ahead are:
Euro: GfK Consumer Confidence for March for Germany, Unemployment rate for February for Germany, Inflation Rate preliminary for February for Germany, Inflation Rate for February for Euro Zone,
USD: Durable Goods Orders for January, CB Consumer Confidence for February, GDP Growth rate second estimate for Q4, PCE Price Index for January, ISM Manufacturing PMI for February, Michigan Consumer Sentiment Final for February
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