EUR gains are extended after the increase in the ZEW – Scotiabank index

The Zew investors in Germany had a significant improvement after the German government’s plans to significantly increase infrastructure and defense spending. The current situation index remained weak in –87.6 in March, but the expectations component jumped from 26.0 in February to 51.6, says Shaun Osborne, head of FX of Scotiabank FX.

Parliament ready to vote on spending

“The Parliament will vote on the tax plans today (the High House will vote at the end of the week), but, after the conversations of last week, the approval is almost an inevitable conclusion. The plans could inject a serious amount of stimulus (3-4%/GDP) in the coming years. Peace conversations in Ukraine could, to some extent, be helping the feeling of the Eur.”

“The EUR/USD is expanding the profits to new marginal maximums this morning – fractically above the peak last week, but also fractionally below the setback resistance of 1,1065 (76.4% of fibonacci of the movement of 1.12/1.01 downward) Promotion of tendency in intradic studies, newspapers and weekly. ”

“This suggests that the price action will be characterized by a solid support for the EUR in minor falls (means/high of 1.08) and a continuous offer. A thrust through point 1.1065 leaves little on the path of an increase to 1.12.”

Source: Fx Street

You may also like