On Friday, EUR rose 0.39% against the USD and closed at 1.2524, after the Euro-zone and its peripheries registered positive Q3 GDP data.
The Euro-zone’s quarterly GDP grew 0.2% in 3Q 2014, higher than market expectations for a gain of 0.1% and compared to a 0.1% rise registered in the prior quarter. On the other hand, German GDP rose 0.1% on a quarterly basis in 3Q 2014, at par with market estimates and following a 0.1% contraction recorded in 2Q 2014, thus calming fears over the economic health of the entire European economy.
In other economic news, French economy rebounded 0.3% on a QoQ basis in 3Q 2014, after dropping 0.1% in the previous quarter, while Italy’s economy continued to remain in recession in the same period. Meanwhile, annual consumer prices in the common-currency bloc climbed 0.4% in October, in line with market estimates.
Separately, the ECB Executive Board Member, Benoit Coeure, stated that fiscal policies should be used to underpin global economic growth by promoting investments, as monetary policies alone cannot bear the entire burden to spur growth.
In the US, advance retail sales rebounded 0.3% in October, higher than market expectations for a 0.2% rise. It had eased 0.3% in the previous month. Additionally, the nation’s Michigan consumer sentiment index surged to a level of 89.4 in November, marking its highest reading since July 2007, compared to a reading of 86.9 recorded in October. Meanwhile, business inventories climbed 0.3% in September, exceeding market expectations for an increase of 0.2%.
On Friday, St Louis Fed President, James Bullard mentioned that low inflation rate in the US was not enough to justify the central bank’s decision to keep its interest rates near zero percent levels .However, he hinted that the FOMC would raise its key interest rates in 2015 and it would depend on macroeconomic data.
Over the weekend, in a noteworthy event, the member countries of the latest G-20 Leaders’ Summit in 2014 vowed to reform measures to boost their economies by an extra 2.1% by 2018, adding about $2.0 trillion to global economies.
In the Asian session, at GMT0400, the pair is trading at 1.2556, with the EUR trading 0.26% higher from Friday’s close.
The pair is expected to find support at 1.2443, and a fall through could take it to the next support level of 1.2331. The pair is expected to find its first resistance at 1.2623, and a rise through could take it to the next resistance level of 1.2691.
Trading trends in the Euro today are expected to be determined by the ECB Chief, Mario Draghi’s speech, scheduled later in the day.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.