The Euro to US Dollar (EUR/USD) exchange rate managed to edge slightly higher on Friday as Germany’s trade surplus widened and US employment figures fell short of forecasts.
According to forex expert Lennon Sweeting; ‘It was a miss from expectations. The market was anticipating a higher reading but, from our perspective here, this is just a bump in the road and dollar strength is still intact.’
With a stream of data releases ahead, more EUR/USD exchange rate movement can be expected.
Monday 10th EUR/USD to Extend Advance?
Although the solitary European economic data publication is forecast to decline on Monday (Eurozone Investor Confidence), the singular US data publication, Labour Market Conditions Index, is of less significance in terms of the provocation of volatility. Therefore, it is likely that the EUR/USD exchange rate will strengthen having advanced last Friday.
UPDATE 10/11/2104
The Euro to US Dollar exchange rate is currently trending in the region of 1.2470.
On Monday morning the Euro to US Dollar exchange rate has advanced by around 0.13%. This can be attributed to continued negative sentiment towards the ‘Greenback’ (USD) after nonfarm payrolls data disappointed. ‘The disappointing nonfarm payrolls data have given the market an opportunity — especially for a lot of investors in Asia — to take profits off the table from the Dollar’s strength,’ said Desmond Chua, a strategist at CMC Markets in Singapore.
The Euro, meanwhile, is holding steady ahead of investor confidence data which is forecast to edge lower from -13.7 to -13.8.
UPDATE 10/11/2014
The Euro to US Dollar exchange rate is currently trending in the region of 1.2449.
Eurozone Investor Confidence managed to avoid declination as economists had predicted, with the actual data increasing from -13.7 to -11.9. However, the EUR/USD exchange rate has softened which is likely to be as a result of traders fearing the US Dollar declination is unjustified.
Having sent the US Dollar crashing against all of its major peers after payroll data disappointed, the North American asset is slowly recovering despite a lack of data to provoke volatility.
Tuesday 11th EUR/USD to Decline in Quiet Session
Given that there is a complete absence of European data on Tuesday, the Euro is likely to decline. The solitary US economic data publication, Small Business Optimism, is of little consequence in terms of sparking wider market movement. It should, however, allow the US Dollar to strengthen against the common currency.
Wednesday 12th EUR/USD to Strengthen on Industrial Improvement
If you go by forecast figures, the Euro should advance against the US Dollar on Wednesday. Year-on-year Eurozone Industrial Production is forecast to improve from -1.9% to -0.2%. The monthly industrial production figure is also forecast to advance.
US Wholesale Inventories, however, is forecast to decline from 0.7% to 0.2%. The rest of the US economic data publications are of little value in terms of the provocation of US Dollar volatility.
Thursday 13th EUR/USD to Fluctuate on Final CPI
With both European and North American data likely to produce mixed results, the EUR/USD exchange rate could fluctuate on Thursday. The final German Consumer Price Index and EU-Harmonised German Consumer Price Index are forecast to equal their previous estimates. However, the European Central Bank also publishes its Monthly Report on Thursday, which could offer extra information regarding additional stimulus measures and may cause the common currency to plummet.
US Initial Jobless Claims is forecast to show an unwanted rise from 278,000 to 280,000. Continuing Claims, however, is expected to show a positive declination from 2,348,000 to 2,320,000. The rest of the US data publications are unlikely to register compared with the labour market data.
Friday 14th EUR/USD to Seesaw as US Publishes Sales Data
There will be several influential domestic data publications provoking changes for the EUR/USD exchange rate on Friday.
The single currency is likely to soften on Friday morning as traders await German, French and Italian growth data. Seasonally adjusted German Gross Domestic Product is forecast to decline from 1.2% to 1.1%, but the non-seasonally adjusted German GDP is expected to increase from 0.8% to 1.0%. Yearly French GDP is expected to grow from 0.1% to 0.4%, and yearly Italian GDP is forecast to decline from -0.2% to -0.4%.
Later on Friday morning the Euro will be subject to more volatility with Eurozone growth and inflation data due for publication. The yearly Eurozone Consumer Price Index is expected to equal the previous figure of 0.4%. Similarly, Eurozone Core CPI is forecast to stick to the forecast of 0.7%. Eurozone Gross Domestic Product, however, is forecast to increase from the flat-line 0.0% to 0.1%.
Friday afternoon’s US data will provoke yet more volatility for the EUR/USD exchange rate. US Advance Retail Sales is predicted to increase from -0.3% to 0.2%. Retail Sales less Autos and Retail Sales Control Group are both also forecast to increase.
Some industry experts have expressed the opinion that the recent US jobs figures point to a better sales figure. For example, Bob Yawger asserted; ‘The unemployment rate dropped to 5.8 percent even as the labour force expanded, which implies that more people will be consuming goods and driving. This is all good for demand.’
Later on Friday afternoon the University of Michigan Confidence Survey will trigger EUR/USD movement. It is forecast to tick up from 86.9 to 87.5. Business Inventories will also be of interest to those invested in the US Dollar and is expected to hold at 0.2%.
The Euro to US Dollar exchange rate is currently trending in the region of 1.2452
Euro Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,
,Pound Sterling,0.7846,
Euro,,US Dollar,1.2452,
Euro,,Canadian Dollar,1.4101,
Euro,,Australian Dollar,1.4419,
Euro,,New Zealand Dollar,1.6048,
US Dollar,,Euro ,0.8031,
Pound Sterling,,Euro,1.2742,
Canadian Dollar,,Euro,0.7085,
Australian Dollar,,Euro,0.6929,
New Zealand Dollar,,Euro,0.6222,
[/table]
