US Dollar Currency News: USD Trending Lower ahead of Latest FOMC Meeting Minutes Today
Although Eurozone data will be relatively lacking on Wednesday the Euro (EUR) has begun to rally, taking back some of its recent losses against rivals. Ahead of the publication of the Federal Open Market Committee’s (FOMC) October meeting minutes the US Dollar (USD) has been trending lower, as investors begin to dial back their expectations for an imminent interest rate hike. Consequently the EUR/USD exchange rate was climbing in the range of 1.0672 this morning.
As the deadline for the release of a 2 billion Euro tranche of Greek bailout funds approaches today the EUR/USD exchange rate has continued to retreat, falling to its lowest level since April.
Increasing Odds of Fresh ECB QE Weigh on EUR despite Improvement in Eurozone Inflation
In the wake of Friday’s terror attacks in Paris the Euro (EUR) entered a sharp slump at the beginning of the week, weighed down as traders struggled to process the wider economic implications of the resultant surge in geopolitical tension. This overshadowed an unexpected uptick in the finalised Eurozone Consumer Price Index for October, which showed that inflation within the currency bloc had actually risen by 0.1% rather than stagnating. Comments from European Central Bank (ECB) policymakers lent further support to the odds that the central bank will opt for further monetary loosening measures in December.
Global risk aversion was generally on the rise yesterday, to the strong benefit of safe-havens such as the US Dollar (USD). Despite the Empire Manufacturing Index failing to show as strong an improvement as forecast, clocking in at -10.74 rather than -6.35, the ‘Greenback’ extended gains against rivals throughout Monday.
Euro Currency News: EUR Dovish as Latest Greek Bailout Deadline Approaches
Attention has been turning back towards Greece on Tuesday, as the latest deadline approaches for an agreement over the Hellenic nation’s foreclosure laws. Policymakers remained in discussion with creditors overnight in an attempt to break the deadlock over the terms of the nation’s third bailout, with officials indicating this morning that a deal is in sight. Ahead of the day’s meeting of Eurogroup finance ministers, which is hoped will vote to release the 2 billion Euro tranche of funds, the common currency is likely to experience further volatility.
Nevertheless, the ‘Greenback’ has continued to extend its recent gains today ahead of the October US Consumer Price Index. Traders anticipate that the measure will show a slight increase in inflationary pressure on the year, rising from 0.0% to 0.1%. A bullish showing would lend further support to calls for the Federal Open Market Committee (FOMC) to begin the cycle of monetary tightening before the end of the year, a prospect likely to bolster the US Dollar.
EUR/USD Exchange Rate Forecast: German Economic Sentiment Forecast to Strengthen Today
This morning’s German ZEW Economic Sentiment Survey may provide a rallying point for the Euro, however, should the index demonstrate an improvement in economic confidence within the Eurozone’s powerhouse economy. Expectations point towards a marked uptick, with sentiment forecast to rise from 1.9 to 6.0, despite the ongoing worry of the Volkswagen emissions scandal.
Current EUR, USD Exchange Rates
At time of writing, the Euro to US Dollar (EUR/USD) exchange rate was trending lower in the region of 1.0663, while the US Dollar to Euro (USD/EUR) pairing climbed in the range of 0.9375.