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Euro to US Dollar (EUR/USD) Exchange Rate Forecast to Trend Statically ahead of Eurozone Consumer Prices Data

UPDATE

The Euro to US Dollar (EUR/USD) exchange rate was trending within a narrow range on Wednesday morning.

After Tuesday’s economic data showed Eurozone Employment rose by 0.3% in the second-quarter, the shared currency advanced versus its major peers. This was despite a bigger-than-expected drop in German Economic Sentiment. Wednesday’s Eurozone Consumer price Index has the potential to provoke Euro volatility.

Despite the fact that Tuesday’s US data produced disappointing results, the US asset advanced versus its major peers. The appreciation was likely the result of hopes that the Federal Reserve will look to hike the cash rate on Thursday in order to avoid becoming trapped by volatile market conditions. Today’s US inflation data has the potential to provoke changes for the US asset.

The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1264.

Yesterday…

Euro to US Dollar (EUR/USD) Conversion Rate Predicted to Fluctuate on US Data

The Euro to US Dollar (EUR/USD) exchange rate declined by around -0.3% on Tuesday afternoon.

After European economic data produced mixed results, the common currency held steady versus most of its major peers. The German ZEW Economic Sentiment Survey was predicted to decline from 25.0 to 18.3 in September, but the actual result fell to just 12.1. The drop has been attributed to weak emerging markets and a drop in German exports. Conversely, the German ZEW Current Situation Survey bettered estimates of a drop from 65.7 to 64.0, with the actual result climbing to 67.5.

‘The weakening economic development in emerging markets dampens the economic outlook for Germany’s export-oriented economy,’ ZEW President Clemens Fuest said in a statement. ‘While economic growth in the second quarter was largely driven by external demand, it is becoming less likely that exports will stimulate growth in the near future.’

The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1266.

US Dollar to Euro (USD/EUR) Exchange Rate: Volatility Forecast on US Ecostats

Although trader focus is dominated by this week’s Federal Reserve interest rate decision, the preceding domestic data publications will still be of significance. Any positive result will fuel Dollar gains as the Federal Open Market Committee (FOMC) is pressured into hiking the cash rate. On the flip side of the coin, disappointing US data will cause futures traders to speculate that the FOMC will opt to hold the cash rate on Thursday.

Tuesday’s US data saw Advance Retail Sales, Manufacturing Production and Industrial Production all fail to meet with median market forecasts. Rather strangely, however, the US Dollar gained following these weak results. The appreciation is likely due to traders adjusting positions now that a Fed rate hike is looking increasingly unlikely. A rate hike would cause a significant US Dollar surge so traders were attempting to soften the North American asset in anticipation of a rate hike.

The Euro to US Dollar (EUR/USD) exchange rate dropped to a low of 1.1260 during Tuesday’s European session.

Euro to US Dollar (EUR/USD) Exchange Rate Forecast: US Advance Retail Sales to Provoke Volatility Today

Wednesday’s economic docket will see several influential data publications pertaining to both Europe and the US. For those trading with the single currency, Eurozone inflation data will be of most significance. For those invested in the US asset, US inflation data will also be of interest.

The Euro to US Dollar (EUR/USD) exchange rate reached a high of 1.1329 during Tuesday’s European session.