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EUR/USD Exchange Rate Holds Gains as Eurozone Posts Historic Deficit

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The Euro has failed to be shaken from its weekly highs against the US Dollar, remaining at a rate of 1.07 despite shedding some gains recently.

  • EUR USD rate posts 1.07 – USD EUR trades at 0.92
  • Poor Eurozone data fails to keep Euro down – First Eurozone trade deficit since 2014 seen
  • US Dollar remains weak after Fed rate hike news – Fewer-than-expected planned hikes disappoint traders
  • Euro gains possible on confidence stats next week – US Dollar advances tied to home sales figures

Although the Eurozone has posted its first trade deficit since the start of 2014, the Euro has remained close to opening levels regardless.

Other Eurozone data has been similarly disappointing, with January’s construction output falling by -6.2%.

The US Dollar’s weakness has been more prevalent today, with continued fallout coming from the news that only two more Fed interest rate hikes are likely in 2017.

For next week’s EUR USD forecast, the Euro is most likely to be moved by the end of the week, when German and Eurozone confidence scores and PMI figures are due for release.

The confidence stats are due on Thursday; Germany’s GfK confidence score previously hit 10 points so could support the Euro if it shows continued growth. For the Eurozone equivalent, the situation is less rosy with a prior posting of -6.2 expected to give way to a marginal improvement of -4.9.

On Friday, the Euro has two chances to advance against the US Dollar with March’s German and Eurozone PMI releases. Covering manufacturing, services and the overall composite score, the figures could firm any Euro US Dollar gains if they show movement away from the contraction range (below 50 points).

Before the weekend, the US Dollar could be raised in demand by today’s University of Michigan confidence score, expected to show an increase from 96.3 to 97.

Looking further ahead, next week’s US data will be mainly comprised of home sales stats.

Existing home sales are expected to post slightly lower on Wednesday while new home sales are due to increase on Thursday.

Ending US economic announcements on Friday will be goods orders and PMI figures; the only forecast has been for a decline in durable goods orders from 1.8% to 1.5%, which is unlikely to confer gains to the US Dollar Euro exchange rate.

Current EUR USD Interbank Exchange Rates

At the time of writing, the Euro to US Dollar (EUR USD) exchange rate was trading at 1.07 and the US Dollar to Euro (USD EUR) exchange rate was trading at 0.92.