Thursday ended with the EUR/USD being high above of local resistance of 1.10. What's the target now?
Evergreen buck goes up
On Wednesday, the evergreen buck jumped, backed by comments from senior Fed officials playing down the probability of interest rate cuts, and also by a fresh round of safe-haven buying on geopolitical tensions.
Estimating the greenback’s purchasing power against its main counterparts the USD index hit 97.36, adding about 0.5% from Monday’s minimums and soaring by 0.1% from Tuesday.
The evergreen buck jumped versus the Australian and New Zealand dollars after data uncovered in China indicated that industrial output as well as retail sales falling short of expectations in April - even before the imposition of fresh levies on its exports to America.
On Wednesday, Chinese shares jumped, in anticipation of further stimulus from China’s major financial institution.
On Tuesday, American leader called on the Fed to match any stimulus provided by China in order to compensate for the economic damage from his fresh levies.
Kansas City Fed President Esther George stressed that lower interest rates might drive asset price bubbles, generate financial imbalances and even downtime, and also put the responsibility for any risk to the American economy on trade policy uncertainty as well as slower surge abroad, including China, Great Britain, and the European Union. John Williams, New York Fed President stressed that levies would probably drive inflation.
As for the common currency, it was drifting after news that the German economy managed to ascend by about 0.4% in the first quarter – an outcome, which has already been overshadowed by downbeat business polls in May and April. As for a second outcome of Eurozone GDP, it will come out a bit later on Wednesday.
The European central bank will publish the main refinancing rate and make a statement on Thursday, July 16, at 14:45 MT time. Also, the ECB’s press conference will be later at 15:30 MT time.
Optimism about the Moderna vaccine improved the market sentiment. Let’s have a closer look, what’s happening today.
The Canadian central bank will announce interest rates and make a speech on Wednesday, July 15, at 17:00 MT time. Also, the BOC press conference will be later at 18:15 MT time.