EUR/USD pares the biggest daily loss in three weeks around 1.0650 ahead of EU/US PMIs – Crypto News – Crypto News
Connect with us
EUR/USD inches to near 0.9970 but is still inside the woods, focus shifts to Fed's Powell EUR/USD inches to near 0.9970 but is still inside the woods, focus shifts to Fed's Powell

others

EUR/USD pares the biggest daily loss in three weeks around 1.0650 ahead of EU/US PMIs – Crypto News

Published

3 years ago

on

  • EUR/USD picks up bids to refresh intraday high, reverses pullback from six-month top.
  • ECB-inspired rally battles with the US Dollar’s safe-haven demand.
  • Sluggish markets allow traders to pare recent moves ahead of preliminary PMIs for December.

EUR/USD prints mild gains around 1.0640 as it refreshes the intraday high during early Friday. In doing so, the major currency pair consolidates the biggest daily fall in three weeks while reversing the previous day’s pullback from the highest levels in six months ahead of the key activity data from Europe and the US.

European Central Bank’s (ECB) hawkish hike of 0.50% propelled the EUR/USD pair towards the fresh multi-day peak of 1.0736 late Thursday. However, fears of recession underpinned the US Dollar’s safe-haven demand and drowned the quote thereafter.

That said, the ECB matched market forecasts while announcing the 50 basis points (bps) rate hike. However, comments from President Christine lagarde bolstered the bullish bias as she said, “Info predicates 50 bps next meeting, possibly next one as well, possibly thereafter.” The ECB also announced the plan to end the Asset Purchase Program (APP) via gradual Quantitative Tightening (QT).

It should be noted that the broadly hawkish rate announcements from the major central banks joined the fears of higher inflation and energy crisis to amplify recession concerns, which in turn allowed the US Dollar to cheer its safe-haven status despite witnessing mixed data.

US Retail Sales flashed -0.6% MoM figure in November versus 0.1% expected and 1.3% prior. Further, manufacturing survey details from Philadelphia fed and New York Fed came in disappointing for the said month whereas Industrial Production eased in November and the Jobless Claims also dropped for the week ended on December 09.

Amid these plays, the Wall Street benchmarks slumped and the US Treasury bond yields rallied, which in turn allowed the US Dollar Index (DXY) to print the biggest daily gains in 10 weeks. Recently, S&P 500 Futures and the US Treasury bond yields remain sidelined as traders await the first readings of December month activity numbers for Germany, the Euro Area and the US. Also important to watch will be the final readings of the euro zone inflationdata.

technical analysis

A five-week-old ascending support line, near 1.0600 at press time, defends EUR/USD buyers.

Related Topics:
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending