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Euro US Dollar Exchange Rate Turbulence Likely on Trump Policies

Last week saw the Euro US Dollar exchange rate progressively worsen, although another week of Trump-inspired volatility could reverse this trend.

  • EUR USD rate moved between 1.07-1.07 last week – USD EUR ranged from 0.92-0.93
  • Euro moved by German data last week – Mix of PMI data unsettled investors
  • US Dollar rocked by Trump’s wall plans – Mexico still to foot the bill, says Trump
  • Eurozone-wide sales and confidence stats incoming – Trump policies likely to cause further USD shifts

US President Donald Trump made his bombastic entry into politics proper last week, causing high turbulence for the US Dollar as he altered US trade, health and immigration policies.

Last Week’s Biggest EUR USD Stories: Wall will be Built, Says Trump

The Euro remained turbulent against the US Dollar during trading last week, though mainly due to US developments.

In the Eurozone, news included the fact that German and Eurozone confidence of current conditions had improved in January, while Eurozone-wide manufacturing PMIs rose and services PMIs dropped.

In the more active US, investors remained focused on the White House throughout the week. Offering a taste of what his four-year tenure could be like, Donald Trump hit the ground running and withdrew the US from the Trans-Pacific Partnership (TPP) and pledged that the US-Mexico border wall would be built.

The latter situation caused a diplomatic incident and led to the Mexican President cancelling a visit to Trump, while White House officials suggested that the cost to the US could be recouped with a 20% import tax on Mexican goods.

Weekly Euro Forecast: Data-Heavy Week – Eurozone Retail Sales, PMIs and Confidence

The Euro could be in for a long week moving ahead, given just how many high-impact releases are due.

Just to skim through the scheduled announcements, Eurozone-wide sentiment and confidence stats are forecast to improve on Monday morning, while German inflation is set to rise on Monday afternoon.

Tuesday has a reduction in German unemployed persons expected, while Eurozone GDP growth is set to rise on the same day.

Over Wednesday and Friday, key Eurozone PMI stats are expected, as well as Friday’s Eurozone-wide retail sales results for December. In the latter case, a monthly rise from -0.4% to 0.4% is forecast.

Recent EUR USD Interbank Exchange Rates

At the time of writing, the Euro US Dollar (EUR USD) exchange rate was trending in the region of 1.06 and the US Dollar Euro (USD EUR) exchange rate was trending in the region of 0.93.