The EU plans to intervene in markets directly to curb rising energy costs, threatening to push the Euro area's economy into a deep recession.
EUR/USD: outlook for August 25 - September 1
2019-11-11 • Updated
EUR/USD kept trading near the benchmark line of 200-week MA (1.1760). The euro continued its consolidation and stayed within a narrower range.
ECB President Mario Draghi avoided giving any clues on the European Central Bank’s current thinking in his speech in Germany. According to Draghi, central banks must be open-minded on policy innovations as they prepare for future economic developments. Another speech at Jackson Hole on Friday evening will set the tone for the next trading days. Other comments from the ECB policymakers were hawkish and bullish for the euro.
European economic data were mostly bright. Euro zone business growth maintained solid pace in August due to a strong manufacturing PMI, although the region’s services PMI declined. German Ifo business climate surprised to the upside.
In the upcoming days, there will be some data releases of medium importance in the euro area. Pay attention to German preliminary CPI on Wednesday and flash consumer inflation figures for the entire euro zone on Thursday: these figures will be crucial for further ECB policy and, consequently, will move the market.
EUR/USD remains within the overall uptrend. Only a decline below 1.1650 will mean reversal to the downside. This level will become in focus if the euro slips below 1.1765 and 1.1690. An increase above 1.1845 is needed for the uptrend to continue. In this case, further bullish targets will lie at 1.1900 and 1.2000.
The oil prices rally and world central banks’ dovish monetary policy caused by the Covid-19 pandemic were the main reasons for current inflation growth…
Weaker recoveries were seen in both the UK manufacturing and service sectors, with the latter recording the greatest loss of momentum since July.
The past several weeks have been a real triumph for the bulls in the oil market. The Brent spot price grew by 8.5% during the last month.
Gold prices are rising for three consecutive days ahead of the Federal Reserve (Fed) interest rate decision, which is expected to remain unchanged due to declining inflation and a positive economic outlook. Investors are keen on the Fed's interest rate guidance, fearing a hawkish stance that could trigger market risk aversion.
Amid concerns of a Chinese economic slowdown, reports of declining investment often overlook China's efficient investment strategy in emerging sectors for long-term growth. China has taken measures to stabilize foreign and private sector investments, like reducing the reserve requirement ratio to boost investor confidence.