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Euro (EUR) Static Against US Dollar (USD) Before US Jobs Data

  • Common currency appreciates on Spanish unemployment – Six-year low seen
  • US Dollar remains divided due to conflicting data – Chances of near-term Fed rate hike uncertain
  • Beige Book results positive – Slow and steady stats posted
  • ECB interest rate decision dull – Central bank hints at further easing

EUR/USD Unchanged After ECB Rate Decision

The Euro to US Dollar (EUR/USD) exchange rate was little changed following the European Central Bank’s (ECB) interest rate decision on Thursday.

As expected, the central bank left policy unadjusted but suggested that changes could be made if the situation warranted.

Today’s US unemployment figures are liable to trigger notable movement in the EUR/USD pairing, with positive results potentially sending the Euro lower into the weekend.

As it stands, the Euro is trading in the region of 1.1149

(Previously updated 10:00 am 02/06/2016)

The Euro has been a mixed option so far today, although for the most part it has been trending in a positive range against its peers.

The US Dollar has been a more unstable option, owing to the continually uncertain situation regarding a potential Fed interest rate hike.

Eurozone Economic News: Euro Advances as Spanish Unemployment Drops

The single currency has been able to appreciate against a number of competitors today due to positive investor outlooks; these gains have been made up of 0.2% against the US Dollar (EUR/USD), 0.4% against the New Zealand Dollar (EUR/NZD) and 0.5% against the Australian Dollar (EUR/AUD).

At the start of a fairly busy day for Eurozone data, only a single piece has come out so far to boost the Euro’s appeal. This has been Spain’s unemployment change for May, which has fallen by -119.8k, putting the current unemployment rate in the country at a six-year low.

Although this is clearly positive news, it is worth remembering that Spain still has the second highest level of unemployment in the EU.

US Dollar Drops off on Further Conflicting Data Releases

The ‘Buck’ has been an undesirable option for investors today, due to the continuing air of uncertainty over when the Fed will next decide to hike the benchmark interest rate.

Yesterday’s news failed to clarify the issue, as falling mortgage applications for May were then countered by a rise in the ISM manufacturing result for the same period.

Continuing the seesaw of printings, April’s construction spending fell from 1.5% to -1.8% while the later Fed Beige Book announcement recorded ‘modest growth’ across most of the US.

In response to this latest piece of news, however, Deutsche Bank economist Joseph LaVorgna stated in a social media post that the central bank appeared to be more cautious, saying:

‘Tone of Fed’s Beige Book a bit more subdued: “modest” mentioned 13 times vs. “moderate” 10 times in May compared to 8 times each in April survey’.


Future EUR, USD Forecast: ECB Policy Decisions and Fed Speeches due Today

The next economic announcements to watch out for will come from the Eurozone, in the form of the European Central Bank (ECB) interest rate decision, which is due alongside a number of other potential policy adjustments.

From the US will be a speech firstly from Fed official Jerome Powell on prudential regulation, then a later contribution from Robert Kaplan, who is expected to talk in Boston about the economy.

Current EUR, USD Exchange Rates

The Euro to US Dollar (EUR/USD) exchange rate was trending in the region of 1.1211 and the US Dollar to Euro (USD/EUR) exchange rate was trending in the region of 0.8919 today.