EUR/USD Exchange Rate Rangebound, German Trade Balance Beats Forecasts
The Euro US Dollar (EUR/USD) exchange rate held steady this morning, with the pairing currently trading around $1.106 after Germany’s trade balance figure for October beat forecasts and rose from €19.2 billion to €20.6 billion.
Today also saw Germany’s exports figure for October rise to a better-than-expected 1.2%.
October’s trade data provides some uplift for the Euro (EUR), with hopes now rising over the Eurozone’s largest economy avoiding a contraction in the final quarter.
Carsten Brzeski, Chief Economist at ING, Germany, commented:
‘Despite the ongoing trade conflict and a slowdown in the global economy, German exports have held up surprisingly well in recent months.
‘Today’s trade figures are the first positive data for the final quarter of the year. With disappointing consumption and industrial data but encouraging trade data, the economy will remain on a bumpy road between contraction, stagnation and meagre growth.’
USD/EUR Exchange Rate Steady, Positive US Payroll Figures Hold Up ‘Greenback’
The US Dollar (USD) failed to gain on the Euro (EUR) despite ‘Greenback’ trader’s being buoyed by Friday’s stronger-than-expected US payroll release ahead of this Wednesday’s Federal Open Market Committee’s (FOMC) economic projections.
Improving US jobs data has pushed back 2020 rate cut expectations from the Federal Reserve, resulting in a steady USD/EUR exchange rate at the beginning of this week.
Meanwhile, ongoing US-China trade uncertainty also continues to boost the safe-haven value of the US Dollar today, with falling Chinese exports heightening the appeal of the ‘Greenback’ today.
Jeffrey Halley, the Senior Market Analyst at OANDA, commented:
‘China is clearly not immune to either the U.S. trade tariffs, or the lingering slowdown in the broader global economy.’
US Dollar investors are remaining cautious, however, as they assess the probability of Washington imposing further tariff hikes on Chinese imports.
Any signs of a further flare-up between the world’s two largest economies could work negatively against the US economy and weaken market confidence in the US Dollar.
EUR/USD Outlook: German Economic Sentiment in Focus
Euro (EUR) investors will be looking ahead to tomorrow’s publication of December’s German ZEW Survey of economic sentiment, with any signs of improvement being Euro-positive.
US Dollar traders, meanwhile, will be awaiting tomorrow’s release of the US Nonfarm Productivity figure for the third quarter, which is expected to fall to -0.2%.
Tomorrow will also see the release of the US Unite Labour Costs figure for the third quarter, with any signs of improvement likely to provide a boost for the USD/EUR exchange rate.