EURUSD Movement
For the 24 hours to 23:00 GMT, the EUR rose 1.00% against the USD and closed at 1.1219.
In economic news, the Euro-zone’s construction output rebounded at its fastest pace in nearly four years by 3.6% MoM in January, following a revised 0.7% drop in the previous month.
The greenback lost ground, after the US Federal Reserve policymakers indicated that they expected just two quarter-point rate hikes in 2016, instead of the earlier forecast for four hikes. The US central bank also held benchmark interest rate steady at 0.5%, citing risks to the US economy from global financial and economic developments. Despite the risks, the central bank currently expects that economic activity would expand at a moderate pace and labour market indicators would continue to strengthen. Also, it downgraded the estimates of GDP growth in 2016 to 2.2% from 2.4%.
In other economic news, US industrial production fell more-than-expected by 0.5% in February, compared to investor expectations for a 0.3% fall and after registering a revised 0.8% rise in the previous month. On the other hand, the nation’s housing starts recorded a rise of 5.2% MoM, to an annual rate of 1178.0K in February, more than market expectations of a rise to a level of 1150.0K. In the previous month, housing starts had registered a revised level of 1120.0K.
Another set of data showed thatthe nation’s consumer price index recorded a drop of 0.2% MoM in February, compared to a flat reading in the prior month. Markets were expecting the consumer price index to fall 0.2%.
In the Asian session, at GMT0400, the pair is trading at 1.1220, with the EUR trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.1104, and a fall through could take it to the next support level of 1.0988. The pair is expected to find its first resistance at 1.1289, and a rise through could take it to the next resistance level of 1.1359.
Going ahead, investors look forward to the Eurozone consumer price inflation and trade balance data, due in a few hours. Additionally, the US initial jobless claims data, scheduled to release later today, will also attract market attention.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.