EUR/USD fell slightly during the session on Tuesday. The economists of Commerzbank analyze the pair’s prospects before the long weekend.
EUR/USD trading to be rather weak ahead of the weekend
On the Dollar side, the latest economic data will be published today to which it could react; These are Durable Goods Orders, Initial Jobless Claims and University of Michigan Sentiment. If the data confirms the market view that the Fed will have to cut rates soon, the Dollar could depreciate a few more points again.
Eurozone November PMI data will be published on Thursday. If they register a rise, the market could adjust its expectations of a rate cut by the ECB, so the Euro could appreciate.
However, we do not expect the indices to signal a recovery in activity, at most we expect to see a stabilization in recessionary territory. This means that they are probably not suitable to provide additional support to the Euro against the Dollar, allowing the Euro to edge higher and approach 1.10.
EUR/USD trading will be rather weak heading into the weekend and will make us all yawn. But you never know what surprises may lurk around the corner, for example on the geopolitical front. In that case, low trading volumes can lead to strong fluctuations.
Source: Fx Street
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