EUR/USD Exchange Rate Steadies as US Growth Expected to Remain Moderate
The Euro US Dollar (EUR/USD) exchange rate is steady today and is currently trading around $1.1139 on the inter-bank market.
The US Dollar (USD) stabilised against the Euro (EUR) as traders await today’s flash GDP figures for the first quarter, which are expected to ease slightly to 2.1% against last year’s 2.2%.
US economic growth is expected to remain moderate, and this has failed to provide any uplift for the ‘Greenback’.
Sam Bullard, a Senior Economist at Wells Fargo Securities, commented:
‘The economy remains solid, but we anticipate a slowing in the pace of growth in the medium term as the tailwinds from fiscal stimulus fade and the headwinds of tighter monetary policy take hold.’
Today will also see the publication of the flash US personal consumption expenditures prices for the first quarter.
These will be followed by the US Michigan Consumer Sentiment Index figures for April, which are expected to improve.
The Euro, meanwhile, stabilised following this morning’s publication of the French consumer confidence figures for Apr, which fell below the consensus of 97 and remained static at 96.
EUR/USD Exchange Rate Rangebound as Brexit and Italy’s Recession Presents Euro Gains
The lack of forthcoming UK Brexit news has begun to weigh on the single currency, as cross-party talks between the two major British parties, Labour and Conservative, are failing to indicate any possible deal between the UK and the EU.
Italy, with its ongoing recession, is also weighing on sentiment in the European currency.
Mario Centeno, a leader of the Eurogroup’s 19 ministers, commented:
‘It is a challenge we should never be complacent about and that is why there is worry. That is where the big challenge of the Italian economy is: to grow.’
The single currency has failed to make any gains against the ‘Greenback’ following yesterday’s disappointing Spanish unemployment survey figures for the first quarter, which increased above forecast to 14.70%.
Meanwhile the European Central Bank’s (ECB) economic bulletin bought little in the way of reassurance, despite the recent US tariffs on European exports leaving – according to the ECB – little effect on the Eurozone’s economy.
EUR/USD Forecast: Sterling Could Rise if the Cross-Party Brexit Deadlock Shows Signs of Breaking
Euro traders will be looking ahead to Monday’s printing of the Eurozone’s business climate figures for April.
Any improvement in Italy’s PPI figures on Monday could buoy confidence in the single currency, for this would indicate some signs of recovery for the struggling Italian economy.
US Dollar investors, meanwhile, will also be awaiting Monday’s slew of US economic data.
Most notable is the publication of the US personal income figures for March.
The GBP/USD will be sensitive to any Brexit developments next week, and with any signs of cross-party talks providing a Brexit consensus likely to pass Theresa May’s withdrawal deal through Parliament, this would prove Pound-positive.