.jpg)
- The EUR/USD currency pair ended the trading week almost where it started.
- Market balance broadly recovered as Fed cuts wait resumes.
- Next week: EU GDP and US CPI inflation.
The EUR/USD pair ended a quiet trading week near its starting point, trading in a tight range of just over 1%. Fibre tried to make a fresh attempt to return above the 1.1000 level on Monday, but the price spent the rest of the week retreating to familiar technical levels.
Predicting the next week: US CPI and Fed easing expected to control sentiment
The market remains squarely focused on the odds of a September rate cut. Rate markets have priced in the start of a rate-cutting cycle when the Federal Open Market Committee meets on September 18, but bets on an initial double-digit 50 basis point cut have fallen to just above par from around 70% earlier this week. According to the CME’s FedWatch tool, interest rate traders are pricing in a 53.5% chance of a 50 basis point cut in September, with two more 25 basis point cuts through the rest of 2024.
Next week, investors will get another batch of inflation data to worry about, with the US PPI and CPI due out on Tuesday and Wednesday, respectively. US retail sales and another update from the University of Michigan’s consumer sentiment survey are also due later next week. Core PPI and headline CPI inflation remain stuck at around 3% y/y, and investors will be hoping for continued moderation in the prints to keep prices stable. Federal Reserve Bank On the road to lower interest rates.
Preliminary EU GDP growth data is due next week at 00:00 GMT. The median market forecast is for EU growth to remain flat at current levels, with the forecasts in line with previous data of 0.3% and 0.6% on a quarterly and annual basis respectively.
Euro price this week
The table below shows the percentage change in the value of the Euro (EUR) against the major currencies listed this week. The Euro was the strongest against the Swiss Franc.
| US Dollar | euro | GBP | JPY | Almost | Australian Dollar | New Zealand Dollar | Swiss Franc | |
|---|---|---|---|---|---|---|---|---|
| US Dollar | -0.03% | 0.34% | 0.01% | -1.01% | -0.96% | -0.77% | 0.82% | |
| euro | 0.03% | 0.32% | -0.08% | -1.11% | -0.87% | -0.82% | 0.75% | |
| GBP | -0.34% | -0.32% | -0.34% | -1.37% | -1.17% | -1.12% | 0.42% | |
| JPY | -0.01% | 0.08% | 0.34% | -0.99% | -0.96% | -0.82% | 0.82% | |
| Almost | 1.01% | 1.11% | 1.37% | 0.99% | 0.10% | 0.24% | 1.68% | |
| Australian Dollar | 0.96% | 0.87% | 1.17% | 0.96% | -0.10% | 0.04% | 1.60% | |
| New Zealand Dollar | 0.77% | 0.82% | 1.12% | 0.82% | -0.24% | -0.04% | 1.56% | |
| Swiss Franc | -0.82% | -0.75% | -0.42% | -0.82% | -1.68% | -1.60% | -1.56% |
The heat map shows the percentage changes in major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will be EUR (base)/USD (quote).
EUR/USD Price Forecast
The fiber continues to trade on the upside of a ragged descending channel that has affected the EUR/USD pair throughout 2024. The pair remains stable outside the recent technical ceiling barriers, but the upward momentum remains capped below the 1.1000 level.
A bullish pattern of higher lows is consolidating on the daily candles, but the EUR/USD pair is still poised for another drop to the 200-day exponential moving average (EMA) near 1.0800 if the bidders do not return to buying and find support. EUR/USD Prices have risen to new highs in the near term.
EUR/USD Daily Chart
Frequently Asked Questions About the Euro
The euro is the currency used in the twenty member states of the European Union that belong to the eurozone. It is the second most traded currency in the world after the US dollar. In 2022, it will reach 1.2 trillion euros. It has been calculated. This pair accounts for 31% of all foreign exchange transactions, with an average daily trading volume of over $2.2 trillion per day. The EUR/USD currency pair is the most traded pair in the world, accounting To get a discount of around 30% on 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 of the eurozone. The ECB sets interest rates and conducts monetary policy. The ECB’s primary mission is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is to raise or lower interest rates. The euro generally benefits from relatively high interest rates—or the expectation of higher interest rates—and vice versa. The Governing Council of the ECB makes monetary policy decisions at meetings held eight times a year. The decisions are made by the heads of the eurozone’s 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, is an important economic barometer for the euro. If inflation rises more than expected, especially if it is above the European Central Bank’s 2% target, it forces the ECB to raise interest rates to bring it back under control. The euro typically benefits from relatively high interest rates relative to its peers, as they make the region more attractive as a place for global investors to park their money.
Data released measures the health of the economy and can influence 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, it can encourage the European Central Bank to raise interest rates, which would directly boost the euro. Otherwise, if economic data is weak, the euro is likely to fall. Economic data from the four largest economies in the eurozone (Germany, France, Italy and Spain) is of particular importance, as they account for 75% of the eurozone economy.
Another important piece of data released by 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 of time. If a country produces highly demanded exports, its currency will gain value purely from the extra demand generated by foreign buyers seeking to purchase these goods. Thus, a positive net trade balance strengthens the currency and vice versa for a negative balance.
