The Euro (EUR) has made an advance of 0.4% against the US Dollar (EUR/USD) today, a fact that remains somewhat impressive given the afternoon’s inconsistent German Consumer Price Index results.
German CPI Rises Combined with Weak US Goods Outcomes Today
The Euro’s (EUR) gain against the ‘Buck’ (USD) today has been facilitated by the currency-centric data of the afternoon – despite drops close to -1% on the month for the German CPIs, the annual printings have nonetheless risen either in line with or above forecasts.
On the US’s side, the December Durable Goods Orders have shown a catastrophic fall from -0.5% to -5.1%.
The Euro (EUR) has trended narrowly in a tight range against the US Dollar (EUR/USD) today, which represents a marginal improvement compared to earlier. A possible contributing factor to this is the announcement from European Commission official Pierre Moscovici that tougher laws are likely to be implemented to crack down on tax avoidance in the EU.
Google Case may be Turning Point in Demise of Tax Havens
With a lot of media focus now directed on Google’s supposed avoidance of paying tax to the UK, the news that legal loopholes and et al are set to close can only mean good news in the long term to EU governments, who may be able to rake in up to €70bn a year in previously dodged taxation.
The Euro (EUR) has made little positive movement against the US Dollar (EUR/USD) today, having been put in this position by yesterday’s Federal Open Market Committee (FOMC) Interest Rate Decision.
Rate Freeze in January Not Indicative of Year as a Whole, Says Economist
While last night’s Fed Interest Rate Decision resulted in the widely predicted rate freeze, a cautious yet not dovish speech by Chair Janet Yellen prompted PNC Bank Senior Economist Gus Faucher to estimate that ‘they are going to raise rates in March.’ While not guaranteeing such an outcome, Faucher justified his statement by pointing out that domestic data held a far greater precedence in the Fed’s decision-making process than events from further afield.
The Euro (EUR) has remained at a narrow trending against the US Dollar (EUR/USD) today, having been relatively unaffected by the release of additional economic publications by Italy and Germany.
Mix of Printings have No Net Effect on Investor Perceptions of EUR Today
The economic announcements in question have been Germany’s 30-Year Bund Auction which has dropped relative to the prior result and Italy’s rising December Residential Property Prices.
The Euro to US Dollar (EUR/USD) exchange rate has risen by a small amount today, while elsewhere the common currency (EUR) has advanced against many of its peers. The US Dollar (USD) has largely mirrored this kind of performance against its respective rivals.
EUR/USD Exchange Rate News: German Stagnation Fails to Vex Investors Today
The Euro (EUR) has made a number of gains against the competition today; this has chiefly equated to a minor increase against the US Dollar (EUR/USD), 0.4% against the South African Rand (EUR/ZAR), 0.5% against the Pound Sterling (EUR/GBP) and 0.6% against the Indian Rupee (EUR/INR).
Although the ‘high ticket’ news of the German Consumer Confidence result for February has resulted in no change at 9.4%, the single currency has nonetheless risen due to supportive printings elsewhere.
These have included France’s January Consumer Confidence which rose from 96 to 97 and Finland’s and Italy’s like results which respectively increased from 2.4 to 8.2 and from 117.7 to 118.9.
US Dollar (USD) Holds the Line ahead of First 2016 FOMC Interest Rate Decision
The US Dollar (USD) has fared relatively well today, with a minor loss against the Euro (USD/EUR) and a greater decline of -0.5% against the Australian Dollar (USD/AUD) being offset by advances of 0.4% against the Pound Sterling (USD/GBP) and 0.5% against the Indian Rupee (USD/INR).
Although it made some positive movement at the time, yesterday’s US January Consumer Confidence result has since bolstered the US currency, having risen from 96.3 to 98.1 as it did.
This comes ahead of a potentially momentous event for the US economy – the first Federal Open Market Committee (FOMC) Interest Rate Decision of 2016. Due tonight, the decision is not expected to result in any change from the current 0.50%, but speculation over the Fed’s rate activity this year started swirling ever since December’s historic rate hike.
EUR/USD Exchange Rate Forecast: Fed Rate Decision due Tonight – Rate Hike Ahead?
Although the run-up to and aftermath of the FOMC decision is likely to overshadow most of today’s proceedings, the Euro (EUR) may still be able to take an early advantage against the US Dollar (USD) this afternoon when the French Unemployment Benefit Claims figures for December are released. At the time of writing, forecasts were for a change from -15k to 7k, but a lesser rise or even continued decrease could see the Euro remain on top against the ‘Buck’ before the later Fed announcement.
This announcement is not expected to see any interest rate change from 0.50% take place, therefore the tone of any speeches from policymakers such as Janet Yellen are expected to take precedence over the result itself.
Current EUR, USD Exchange Rates
The Euro to US Dollar (EUR/USD) exchange rate was trending in the region of 1.0869 and the US Dollar to Euro (USD/EUR) exchange rate was trending in the region of 0.9204 today.