- Euro US Dollar Exchange Rate News: Pair Above 1.11 – US Dollar weaker as election approaches
- Euro Exchange Rates Bolstered by Domestic Data – German and Eurozone job stats sturdy
- EUR Forecast: Continued Strength Likely – US Dollar weakness to allow Euro advances
- USD Forecast: US Election 4 Days Away – Jitters certain to worsen as date approaches
Euro US Dollar Exchange Rate Ends Week a Cent Higher
The Euro US Dollar exchange rate continued to perform well towards the end of the week’s European trade session and was well on track to end the week a cent above opening levels.
While the pair was slightly boosted by the morning’s Eurozone services scores, weakness in the US Dollar was the main reason for EUR USD’s Friday strength, continuing a trend seen throughout the week.
As well as ongoing uncertainty and anxiety about the closeness of US election polls, USD demand was slightly mixed on the US’ October Non-Farm Payroll report.
The report revealed an underwhelming job change of only 161k throughout the month. Private and manufacturing payrolls also failed to meet expectations.
However, news that the unemployment rate improved to 4.9% as expected, as well as an increase in average wages kept some optimistic. Assuming the economy progresses on track throughout November, higher wages will up bets of a December interest rate hike from the Federal Reserve.
(Previously updated 12:45 GMT 04/11/2016)
Friday’s Euro US Dollar exchange rate news did little to affect the pair’s overall movement trends. EUR USD trended near highs of key psychological resistance throughout the day as US traders continued to readjust ahead of next week’s US election.
Friday morning saw the publication of the Eurozone’s final October service PMIs from Markit, which indicated that while growth had not met preliminary results the Eurozone was still growing at a steady pace.
Downside risks remained heavy for the US Dollar, which fluctuated widely on tightening US election polls. The day’s disappointing US Non-Farm Payroll report was unlikely to have worsened an already weak USD considerably.
(Previously updated 16:51 GMT 03/11/2016)
Euro US Dollar Exchange Rate News: EUR USD Holds Ground Thursday
After slipping in the middle of the European session due to a slight buy-back in the US Dollar, EUR USD recovered to around the day’s opening levels during the American session thanks to the day’s Euro US Dollar exchange rate news.
Demand for the US Dollar was low regardless, but investors were put off further by the day’s US data which included a disappointing PMI from ISM and news that September’s final durable goods orders report had printed a worse-than-expected -0.3%.
ISM’s services/non-manufacturing composite PMI for October failed to meet expectations of a mere slip to 56, instead falling from 57.1 to 54.8.
As a result, EUR USD was able to trend nearer 1.11 once again as Thursday’s session drew to an end.
(Published 12:04 GMT 03/11/2016)
Wednesday’s Euro US Dollar exchange rate news left the pair climbing to its best levels since early-October. While the Euro was bolstered by solid Eurozone ecostats, it was a continued selloff of the US Dollar that allowed EUR USD to advance.
EUR USD gained around half a cent in value on Wednesday, trading around the key level of 1.11. The pair trended a little more flatly on Thursday, but trade risks remain to the upside.
Euro (EUR) Sturdy on Economic Data and US Dollar (USD) Weakness
Despite anxiety and jitters in global markets, causing fluctuations in many major currencies, the Euro was able to hold its ground against the US Dollar due to being the weakening Dollar’s biggest trade rival.
However, other factors have bolstered sentiment towards the Euro, such as this week’s Eurozone data publications.
Wednesday’s session included Markit’s final October Manufacturing PMI for Eurozone states and the bloc as a whole.
While Italian and German manufacturing figures failed to meet expectations, improvements in manufacturing in Spain and France helped to boost the Eurozone’s overall manufacturing score in October to a better-than-expected result.
Wednesday also saw the publication of Germany’s October unemployment report, which printed a surprisingly strong change of -13k. Investors were even more impressed by news that Germany’s key unemployment rate had improved from 6.1% to 6.0%, its best rate since Germany’s reunification in 1990.
Thursday followed with the Eurozone’s overall unemployment rate for September. The figure came in at 10.0% as expected, but August’s score was revised from 10.1% to a better-than-expected 10.0%.
US Dollar (USD) Held Back by Election Jitters, Underwhelming Data
Uncertainty has taken hold of US Dollar trade this week, as the previously strong ‘Greenback’ has become increasingly weak and volatile on the possible outcome of next week’s US Presidential election, sending jitters throughout global markets.
Democrat nominee Hillary Clinton, commonly viewed as the status quo nominee by markets due to policy similarity between her and US President Barack Obama, had been performing very well in national polling in recent weeks.
However, the last week has seen her Republican rival, Donald Trump, gain considerable ground in polling. More than anything, this has increased market volatility and uncertainty, as stated by Neil Massa, senior equity trader from Manulife Asset Management, Boston;
‘The main driver for today is concerns regarding the election. It looked like Clinton was going to win and now that Trump is gaining momentum, it’s making people nervous’
As a result of the market’s focus on the November 8th election, this week’s US data has had little real effect on USD trade.
ADP’s October employment results failed to meet expectations of an improvement from 154k to 165k. Instead, the print slipped to a disappointing 147k.
Wednesday’s Federal Reserve policy meeting also did little to influence USD trade. The bank left US policy frozen once again and maintained a vaguely hawkish stance on monetary policy, leaving bets of a December Fed rate hike high. Normally, this would support the US Dollar, but US election jitters remain too big a force for markets.
Euro US Dollar Exchange Rate News Forecast: Further EUR Highs Likely as USD Falls
Demand for the US Dollar is unlikely to return in the next few days unless polls indicate Clinton is pulling ahead again, or she goes on to win the Presidency regardless.
This means the Euro is more likely to drive EUR USD movement in the coming days and is likely to advance if polls between the two Presidential candidates continue to tighten.
Thursday’s American session will see the publication of the Services PMIs for October from Markit and ISM. ISM’s figure in particular would typically influence ‘Greenback’ movement, but this may be limited if election jitters continue to dominate USD trade.
The Euro’s next chance at moving the exchange rate will come on Friday, depending on whether or not Markit’s final Eurozone services PMIs beat expectations or not.
This is possible, as analysts predict Italian services will have outperformed preliminary results. If other prints also beat preliminary scores, Eurozone services and composite figures could beat expectations and give the Euro another boost.
Friday will also see the publication of the highly anticipated US October Non-Farm Payroll. This figure remains a key indicator for the Federal Reserve and monetary policy. However, US election jitters could weigh on any potential USD movement to come from the results.
At the time of writing, EUR USD trended in the region of 1.11, while USD EUR trended near 0.90. The US Presidential election is forecast to be the biggest mover for Euro US Dollar exchange rate news in the next week.