Previous:
On Wednesday, the Euro closed down against the US dollar. The Euro fell to 1.0882 following the FOMC’s meeting.
The US Federal Open Market Committee decided to maintain current interest rates within its range of 0.75% – 1.00%, and the discount rate at 1.50%. However, the US central bank is still committed to raising interest rates incrementally throughout the year.
According to the latest data from CME Group’s FedWatch, the probability of a rate hike in June has risen from 66.3% to 75.2% and in July from 70% to 77%. The probability of a hike in September currently stands at 87%.
US statistics:
The ISM non-manufacturing index for April rose to 57.5 (forecast: 55.8, previous reading: 55.2);
The number of new private sector jobs added in the US in April came to 177,000 (forecast: 175,000, previous reading revised from 263,000 to 255,000).
Market expectations:
The FOMC’s monetary policy meeting has passed. Now, two more important events remain this week for the Euro. The first is the US jobs report to come out on Friday. the second is the second round of the French presidential election.
Given the fact that the dollar strengthened after the Fed’s decision to maintain interest rates at their current level, for today (Thursday), I’m going to risk predicting a further slide for the Euro to 1.0860. I doubt there will be much buyer activity leading up to the election. It’s unlikely that anyone will want to keep their long positions open over the weekend.
Day’s news (GMT+3):
- 10:55 Germany: Markit services PMI (Apr);
- 11:00 Eurozone: Markit services PMI (Apr);
- 11:30 UK: Markit services PMI (Apr), net lending to individuals (Mar), M4 money supply (Mar), mortgage approvals (Mar);
- 12:00 Eurozone: retail sales (Mar);
- 14:30 USA: Challenger job cuts (Apr);
- 15:30 Canada: trade balance (Mar); USA: initial jobless claims (Apr 28), nonfarm productivity (Q1), unit labor costs (Q1), trade balance (Mar);
- 17:00 USA: factory orders (Mar);
- 19:30 Eurozone: ECB president Mario Draghi’s speech;
- 23:25 Canada: BoC governor Poloz’s speech.
