Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Euro Under Pressure As German Inflation Misses Estimate

Published 04/20/2018, 06:25 AM
Updated 03/05/2019, 07:15 AM

EUR/USD has lost ground in the Friday session. Currently, the pair is trading at 1.2299, down 0.40% on the day. On the release front, there are no major events. German PPI improved to 0.1%, but this fell short of the estimate of 0.2%. Later in the day, the eurozone releases consumer confidence, which is expected to remain at zero for a third straight month.

The German and eurozone economies have been performing well in 2018, but inflation levels remained low in March. German PPI improved from -0.1% to 0.1%, but missed the estimate of 0.2%. Final CPI came in at 1.3%, up from 1.1% a month earlier. Still, the reading fell short of the estimate of 1.4%. With inflation well below the ECB inflation target of around 2%, there is little pressure on the ECB to tighten its accommodative monetary policy. The ECB’s stimulus program is scheduled to wind up in September, but an increase in interest rates is unlikely before 2019.

Investors are keeping a close eye on the ECB, which meets next week for a policy meeting. Despite stronger economic conditions in the eurozone, the ECB has been in cautious mode. At the March meeting, policymakers took a small step, dropping a pledge to increase stimulus if needed. Will we see additional ‘baby’ steps at the April meeting? The markets are not expecting any change in forward guidance, and concerns over recent trade disputes could mean a dovish statement from ECB President Mario Draghi. Traders shouldn’t expect any dramatic moves next week, as the bank will likely continue to preach patience and prudence.

EUR/USD Fundamentals

Friday (April 20)

  • 2:00 German PPI. Estimate 0.2%. Actual 0.1%
  • All Day – OPEC-JMMC Meetings
  • 7:30 German Buba President Jens Weidmann Speaks
  • 10:00 Eurozone Consumer Confidence. Estimate 0 points
  • 11:15 US FOMC Member John Williams Speaks

*Key events are in bold

EUR/USD for Friday, April 20, 2018

EUR/USD for Apr 19-20, 2018

EUR/USD for April 20 at 6:00 DST

Open: 1.2346 High: 1.2353 Low: 1.2295 Close: 1.2299

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.2025 1.2092 1.2235 1.2319 1.2460 1.2581

EUR/USD showed little movement in the Asian session and has lost ground in European trade

  • 1.2235 is providing support
  • 1.2319 has switched to a resistance line after losses by EUR/USD

Further levels in both directions:

  • Below: 1.2235, 1.2092 and 1.2025
  • Above: 1.2319, 1.2460 and 1.2581
  • Current range: 1.2235 to 1.2319

OANDA’s Open Positions Ratio

EUR/USD ratio is almost unchanged in the Friday session. Currently, short positions have a majority (60%), indicative of EUR/USD breaking out and moving to lower ground.

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.