EUR/USD grinds chart paper above 1.0800 after Fed fails to spark rate rally
-
EUR/USD
continues
to
chill
after
testing
above
1.0840
this
week. -
Fedspeak
from
Fed
Chair
Powell
failed
to
deliver
a
dovish-enough
stance. -
US
inflation
data
to
be
the
key
print
later
in
the
week.
EUR/USD
continues
to
settle
closer
to
1.0800
after
a
misfire
in
market
expectations
of
Federal
Reserve
(Fed)
Chairman
Jerome
Powell’s
testimony
before
US
Congress
on
Tuesday.
Despite
a
head
nod
to
improving
inflation
figures,
the
Fed
is
still
leaning
firmly
in
a
cautionary
stance,
pulling
the
rug
from
beneath
markets
that
were
coiled
in
anticipation
of
a
tonal
shift
from
Fed
policymakers.
Forex
Today:
Focus
remains
on
Powell
and
Fedspeak
Traders
are
battening
down
the
hatches
for
the
wait
to
key
US
inflation
data
prints
later
in
the
week,
with
a
smattering
of
Fed
speakers
and
Fed
Chair
Powell’s
second
round
of
testifying
due
on
Wednesday.
US
Consumer
Price
Index
(CPI)
inflation
data
slated
for
Thursday
will
be
the
key
driver
of
market
volumes
in
the
back
half
of
the
trading
week.
Investors
hungry
for
rate
cuts
will
be
looking
for
CPI
inflation
to
churn
lower,
but
median
market
forecasting
models
broadly
expect
annualized
core
CPI
for
the
year
ended
in
June
to
hold
steady
at
3.4%
YoY,
while
headline
CPI
inflation
is
expected
to
tick
upwards
to
0.1%
MoM
in
June
versus
the
previous
flat
print
of
0.0%.
Initial
Jobless
Claims
for
the
week
ended
July
5
are
also
on
the
docket
for
Thursday,
and
are
forecast
to
tick
down
to
236K
from
the
previous
238K.
Finally,
German
Harmonized
Index
of
Consumer
Prices
(HICP)
inflation
figures
are
due
early
Thursday,
but
YoY
German
inflation
in
June
is
expected
to
hold
steady
at
the
previous
print
of
2.5%.
EUR/USD
technical
outlook
The
Fiber
is
on
a
slow
grind
near
1.0800
after
peaking
earlier
this
week
just
north
of
1.0840,
and
intraday
price
action
is
getting
squeezed
between
downside
pressure
and
technical
support
from
the
200-hour
Exponential
Moving
Average
(EMA)
at
1.0787.
EUR/USD
looks
set
to
run
out
of
gas
in
a
near-term
bullish
push
from
the
last
swing
low
near
1.0660.
With
momentum
draining
out
of
the
Fiber,
the
pair
is
set
for
a
tumble
back
below
the
200-day
EMA
at
1.0784.
EUR/USD
hourly
chart
EUR/USD
daily
chart
Euro
FAQs
The
Euro
is
the
currency
for
the
20
European
Union
countries
that
belong
to
the
Eurozone.
It
is
the
second
most
heavily
traded
currency
in
the
world
behind
the
US
Dollar.
In
2022,
it
accounted
for
31%
of
all
foreign
exchange
transactions,
with
an
average
daily
turnover
of
over
$2.2
trillion
a
day.
EUR/USD
is
the
most
heavily
traded
currency
pair
in
the
world,
accounting
for
an
estimated
30%
off
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
for
the
Eurozone.
The
ECB
sets
interest
rates
and
manages
monetary
policy.
The
ECB’s
primary
mandate
is
to
maintain
price
stability,
which
means
either
controlling
inflation
or
stimulating
growth.
Its
primary
tool
is
the
raising
or
lowering
of
interest
rates.
Relatively
high
interest
rates
–
or
the
expectation
of
higher
rates
–
will
usually
benefit
the
Euro
and
vice
versa.
The
ECB
Governing
Council
makes
monetary
policy
decisions
at
meetings
held
eight
times
a
year.
Decisions
are
made
by
heads
of
the
Eurozone
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
(HICP),
is
an
important
econometric
for
the
Euro.
If
inflation
rises
more
than
expected,
especially
if
above
the
ECB’s
2%
target,
it
obliges
the
ECB
to
raise
interest
rates
to
bring
it
back
under
control.
Relatively
high
interest
rates
compared
to
its
counterparts
will
usually
benefit
the
Euro,
as
it
makes
the
region
more
attractive
as
a
place
for
global
investors
to
park
their
money.
Data
releases
gauge
the
health
of
the
economy
and
can
impact
on
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
but
it
may
encourage
the
ECB
to
put
up
interest
rates,
which
will
directly
strengthen
the
Euro.
Otherwise,
if
economic
data
is
weak,
the
Euro
is
likely
to
fall.
Economic
data
for
the
four
largest
economies
in
the
euro
area
(Germany,
France,
Italy
and
Spain)
are
especially
significant,
as
they
account
for
75%
of
the
Eurozone’s
economy.
Another
significant
data
release
for
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.
If
a
country
produces
highly
sought
after
exports
then
its
currency
will
gain
in
value
purely
from
the
extra
demand
created
from
foreign
buyers
seeking
to
purchase
these
goods.
Therefore,
a
positive
net
Trade
Balance
strengthens
a
currency
and
vice
versa
for
a
negative
balance.
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