For the 24 hours to 23:00 GMT, EUR rose 0.09% against the USD and closed at 1.3825, shrugging off its former losses, triggered by the latest batch of soft economic releases from the Euro-zone economy.
Yesterday, data showed that the final Euro-zone’s consumer inflation rate on an annual basis came in line with the four-year low preliminary reading of 0.5% in March, compared to the previous month’s reading of 0.7%. Separately, the Euro-zone’s current account surplus narrowed to a seasonally adjusted €21.9 billion in February, from a record-high-surplus of €25.4 billion in the preceding month.
Meanwhile, the US Dollar lost ground after the Fed Chief, Janet Yellen hinted interest rates in the nation to remain low for some more time until the recovery in the economy does not secure a more solid footing. Furthermore, she expressed concerns on the slackness in the US job markets and further indicated that persistent low-level of inflation is a more immediate threat to the economy than rising prices. However, the Dallas Fed President, Richard Fisher reiterated his support for winding down the Fed’s bond-buying programme by stating that he “did not foresee any reason” for the central bank “to not continue tapering its QE measure to zero.” Additionally, he added that the recovery in the nation is gaining momentum following the extreme winter that distressed economic activity in the first half of 2014. Meanwhile, Dennis Lockhart, President of the Atlanta Fed, projected growth in the US economy to accelerate 3.0% this year and interest rates to rise after mid-2015.
On the economic front, the Fed’s Beige Book survey revealed that economic activity in most regions have more or less emerged from the setbacks it faced mainly due to the brutal winter. Meanwhile, on the economic front, manufacturing production in the US rose for a second straight month in March while the overall industrial production was up 0.7% (MoM), surpassing analysts’ expectations for a 0.5% rise. However, the US housing starts rose less-than-expected last month while building permits unexpectedly fell in March, suggesting that underlying weakness in the housing market still exists in the nation.
In the Asian session, at GMT0300, the pair is trading at 1.3841, with the EUR trading 0.12% higher from yesterday’s close.
The pair is expected to find support at 1.3811, and a fall through could take it to the next support level of 1.3782. The pair is expected to find its first resistance at 1.3861, and a rise through could take it to the next resistance level of 1.3882.
Amid lack of major economic releases from the Euro-zone traders would eye global economic news, along with the weekly US jobless claims data, for further cues in the currency pair.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.