- The EUR/USD rose more than 2.5% on Thursday, reaching a maximum of 21 months.
- The Trump administration cyclic strategy has relieved market tensions for now.
- The key figures for the US feeling remain on the agenda to close the negotiation week.
The EUR/USD shot its highest offers in almost two years on Thursday, exceeding and closing above the 1,1200 zone for the first time in 21 months. Market tensions continue to decrease after the last -minute turn of the Trump administration moving away from its own tariffs, which causes a general weakening in the flows of the US dollar.
In March, US Consumer Price Index (CPI) inflation fell significantly below the projections. The underlying IPC decreased to 2.8% year -on -year, marking a minimum of four years after staying over 3.0% for almost eight months. The general CPI inflation also fell to 2.4% year -on -year. Investment markets would face severe challenges if tariffs reversed the years of Federal Reserve (Fed) efforts to control inflation.
The week will conclude with the results of the Survey of the consumer’s feeling index of the University of Michigan (UOM) on Friday. It is anticipated that the consumer’s feeling index of the UOM decline once again in April, since consumers fight under the pressure of Trump administration tariffs and policies, probably falling to a minimum of almost three years of 54.5. In addition, consumer inflation expectations will be published on Friday, with consumer inflation expectations at 1 year and 5 years of the UOMs previously recorded at 5% and 4.1%, respectively.
EUR/USD price forecast
An acute increase in the bullish impulse that pushes the highest fiber offers has left the action of the stagnant price of anyone. 1,1200 remains a complicated level for euro buyers to overcome it, and intradic operators could be attentive to signs of new technical weakness that drags the torque down.
The technical oscillators are showing firm warning signs of overcompra conditions, and buyers will have more and more difficulties in maintaining offers on the top side of the 200 -day exponential mobile average side (EMA) about 1,0885.
EUR/USD daily graphics
Euro Faqs
The euro is the currency of the 19 countries of the European Union that belong to the Eurozone. It is the second most negotiated currency in the world, behind the US dollar. In 2022, it represented 31 % of all foreign exchange transactions, with an average daily business volume of more than 2.2 billion dollars a day. The EUR/USD is the most negotiated currency pair in the world, with an estimate of 30 %of all transactions, followed by the EUR/JPY (4 %), the EUR/GBP (3 %) and the EUR/AU (2 %).
The European Central Bank (ECB), based in Frankfurt (Germany), is the Eurozone reserve bank. The ECB establishes interest rates and manages monetary policy. The main mandate of the ECB is to maintain price stability, which means controlling inflation or stimulating growth. Its main tool is the rise or decrease in interest rates. Relatively high interest rates (or the expectation of higher types) usually benefit the euro and vice versa. The GOVERNMENT BOOK of the ECB makes decisions about monetary policy in meetings that are held eight times a year. The decisions are made by the directors of the National Banks of the Eurozone and six permanent members, including the president of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the harmonized consumer prices index (IPCA), are an important economic indicator for the euro. If inflation increases more than expected, especially if it exceeds 2% of the ECB, it forces the ECB to rise interest rates to control it again. Relatively high interest rates compared to their counterparts usually benefit the euro, since they make the region more attractive as a place for global investors to deposit their money.
Published data measure the health of the economy and can have an impact on the euro. Indicators such as GDP, manufacturing and services PMIs, employment and consumer trust surveys can influence the direction of the single currency. A strong economy is good for the euro. Not only attracts more foreign investment, but it can encourage the ECB to raise interest rates, which will directly strengthen the euro. Otherwise, if economic data is weak, the euro is likely to fall. The economic data of the four largest economies in the euro zone (Germany, France, Italy and Spain) are especially significant, since they represent 75% of the economy of the euro area.
Another important fact that is published on the euro is the commercial balance. This indicator measures the difference between what a country earns with its exports and what you spend on imports during a given period. If a country produces highly demanded export products, its currency will gain value simply by the additional demand created by foreign buyers seeking to buy those goods. Therefore, a positive net trade balance strengthens a currency and vice versa in the case of a negative balance
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
