Euro US Dollar (EUR/USD) Exchange Rate Slides despite Eurozone Investor Confidence Rising
The Euro US Dollar (EUR/USD) exchange rate plummeted over the course of the morning, and the pairing is currently trading at an inter-bank rate of $1.1320.
This morning, research group, Sentix released its latest assessment of investor confidence in the Eurozone, which boasted a better-than-forecast rise from -3.7 to -2.2.
While current expectations slid for the seventh month in a row, the German think tank found that the future expectations rose.
Commenting on this, Sentix said:
‘It is too early to give the all clear. However, a ray of hope emerges when looking at the economic expectations.’
The Eurozone also boasted better-than-forecast Producer Price Index figures for February, with PPI rising by 0.4%.
However this did little to buoy the single currency.
EUR/USD Exchange Rate Slides despite US-China Summit Speculation
Despite renewed US-China optimism, the Euro US Dollar (EUR/USD) exchange rate continued to slide.
Reports suggested that the US and China were close to reaching a deal with a summit between US President Donald Trump and Chinese Premier Xi Jinping likely to happen towards the end of the month.
It is speculated that Premier Xi could travel to Trump’s Mar-a-Lago resort in Florida to cement a final deal at the tail end of his planned trip to Europe.
On Saturday, President Trump announced he had asked for the removal of tariffs on agricultural products, which likely sparked further optimism.
Trump took to Twitter, stating:
‘I have asked China to immediately remove all Tariffs on our agricultural products (including beef, pork, etc.) based on the fact that we are moving along nicely with Trade discussions and I did not increase their second traunch of Tariffs to 25% on March 1st. This is very important for our great farmers – and me!’
However, this did little to stop the Euro sliding against the Dollar.
Euro US Dollar Outlook: Will the EUR/USD Exchange Rate Rise on Growing Eurozone Retail Sales?
Looking ahead to tomorrow, the Euro (EUR) could rise against the US Dollar (USD) following the release of the Eurozone’s Markit PMI Composite.
If the index remains steady at 51.4 rather than contracting, it could buoy the single currency.
The Euro could be further buoyed by the Eurozone’s January retail sales, which is forecast to rise by 1.2% compared to the previous year.
The US Dollar could rise following the release of February’s US Markit Services PMI.
If the US services sector shows a steady rate of growth, and the index reports 56.2 it could buoy the Dollar.
Also likely to cause the Dollar rise against the single currency is the release of the ISM Non-Manufacturing PMI.
If the PMI rises to 57.2 as forecast, the Euro US Dollar (EUR/USD) exchange rate could fall.