For the 24 hours to 23:00 GMT, the EUR declined 0.42% against the USD and closed at 1.0642, after the ECB’s Executive Board member, Peter Praet, indicated that the central bank is likely to undertake further monetary easing measures in order to kick-start growth and inflation in the Euro-zone.
In economic news, Germany’s ZEW economic sentiment index advanced to a level of 10.4 in November, after declining for seven consecutive months and compared to market expectations of a rise to 6.0. In the previous month, the index had recorded a reading of 1.9. However, the economic sentiment in the Euro-zone dropped to a level of 28.3, hitting a 12-month low in November, from a reading of 30.1 in October, and missing expectations for a rise to 35.2.
The greenback gained ground, after US consumer prices increased in October after two consecutive months of decline, thus providing further impetus to the Federal Reserve’s decision to raise interest rates next month. Data showed that US consumer price index rose 0.2% MoM in October, in line with market expectations and compared to a decline of 0.2% in the previous month. Moreover, manufacturing production in the US advanced 0.4% during the same month, after dropping for two successive months, thus indicating that economic growth would accelerate in the fourth quarter. It had declined by 0.1% in the previous month.
On the other hand, the nation’s industrial production surprisingly fell 0.2% in October, compared to a similar fall in the previous month. Market expectation was for it to rise 0.1%. Additionally, the US NAHB housing market index dropped to a level of 62.0 in November, compared to a revised reading of 65.0 in the previous month, and against market expectations for it to ease to 64.0.
In the Asian session, at GMT0400, the pair is trading at 1.0636, with the EUR trading marginally lower from yesterday’s close.
The pair is expected to find support at 1.0617, and a fall through could take it to the next support level of 1.0598. The pair is expected to find its first resistance at 1.0667, and a rise through could take it to the next resistance level of 1.0699.
Moving ahead, investors will look forward to Euro-zone’s construction output data for September, scheduled to be released in a few hours. Additionally, investors will also concentrate on the FOMC 27-28 October meeting minutes, scheduled later today.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.