News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • The Spinning Top candlestick pattern forms part of the vast Japanese candlestick repertoire with its own distinct features. Gain a better understanding of the spinning top candlestick here: https://t.co/DWm7cC4v7H https://t.co/uhBNvCTHrW
  • Evergrande USD bondholders say have yet to receive interest due Thursday -BBG
  • The US Dollar seems to be back on the offensive against its major counterparts, pressuring EUR/USD and NZD/USD lower as USD/JPY consolidates. USD/CHF surges past key resistance. Get your market update from @ddubrovskyFX here:https://t.co/MrLGSp7FYa https://t.co/J0vSWHaADc
  • Gold prices gain as potential systemic risks out of China's Evergrande Group roil broader markets. Meanwhile, iron ore is ticking higher after a big drop on Monday as China steps up steelmaking curbs. Get your market update from @FxWestwater here:https://t.co/l4kAWDrr7M https://t.co/nmP0MX8LGM
  • 🇯🇵 Core Inflation Rate YoY (AUG) Actual: 0.0% Expected: 0% Previous: -0.2% https://www.dailyfx.com/economic-calendar#2021-09-23
  • 🇯🇵 Inflation Rate Ex-Food and Energy YoY (AUG) Actual: -0.5% Previous: -0.6% https://www.dailyfx.com/economic-calendar#2021-09-23
  • 🇯🇵 Inflation Rate YoY (AUG) Actual: -0.4% Previous: -0.3% https://www.dailyfx.com/economic-calendar#2021-09-23
  • Gold remains higher despite positive Evergrande news out of China. Meanwhile, copper bulls are pushing prices upward as the potential for a housing crisis in China ebbs. Get your market update from @FxWestwater here:https://t.co/TK3MNntBdA https://t.co/T6CPbFLv9f
  • RT @FxWestwater: $AUDUSD, $AUDJPY Surge Despite Rising Treasury Yields, Looming Evergrande Risks Link: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2021/09/23/AUDUSD-AUDJPY-Surge-Despite-Rising-Treasury-Yields--Looming-Evergrande-Risks.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https://t.c…
  • Heads Up:🇯🇵 Core Inflation Rate YoY (AUG) due at 23:30 GMT (15min) Expected: 0% Previous: -0.2% https://www.dailyfx.com/economic-calendar#2021-09-23
Euro Continues to Defy Gravity After Mixed Data Bag

Euro Continues to Defy Gravity After Mixed Data Bag

Martin Essex, MSTA, Analyst

EUR Talking Points:

- EURUSD continues to rise as the Euro-Zone economy steams ahead even though inflation remains subdued.

- ECB must decide whether to tighten monetary policy to cool the economy or leave it loose to stimulate consumer price rises.

Learn how to trade like an expert by reading our guide to the Traits of Successful Traders

New to forex and want to find out more about trading EURUSD? Take a look at our Forex Trading Guides

The Euro remains in demand as the European Central Bank continues to face a difficult question: whether to tighten monetary policy to cool a buoyant economy or to keep policy loose while inflation stays under its target of below but close to 2%.

Data released Wednesday showed German retail sales down by 1.9% in December both month/month and year/year. However, German unemployment fell by a larger than expected 25,000 in January and the unemployment rate in the Euro-Zone as a whole stayed at 8.7%. Inflation in the Euro-Zone slipped to 1.3% in January from 1.4% while core inflation edged up to 1.0%.

Against this mixed background, the Euro continued to take the path of least resistance: upwards.

EURUSD Price Chart, Daily Timeframe (February 1, 2017 to January 31, 2018)

Euro Continues to Defy Gravity After Mixed Data Bag

Chart by IG

Speaking Wednesday, ECB executive board member Benoit Coeure repeated the central bank’s official line that it expects its key interest rates to remain at their present levels for an extended period of time and well past the horizon of its net asset purchases.

We do not believe that the distribution of future inflation risks has moved permanently lower, he added, although many commentators reckon that the current strength of the Euro is adding to the ECB’s headache by keeping inflation so far below target.

Looking ahead

Coeure noted that quantitative easing in the Euro-Zone will not last for ever but added that there is a very broad agreement that the bank’s rate setters have to be patient and prudent, and are not going to be too hasty to change policy.

Nonetheless, further reductions in the ECB’s asset purchases – or even an end to them – seem more than likely late this year, and that will likely continue to support EURUSD, especially if the Dollar remains weak.

--- Written by Martin Essex, Analyst and Editor

To contact Martin, email him at martin.essex@ig.com

Follow Martin on Twitter @MartinSEssex

For help to trade profitably, check out the IG Client Sentiment data

And you can learn more by listening to our regular Trading Webinars

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES