The EUR/USD experiences consecutive bullish sessions, driven by speculation regarding a potential rate cut by the Federal Reserve at the upcoming December meeting, subsequent to the publication of a robust jobs report. Currently, the pair is trading at 1.1595, reflecting an increase of 0.22% after recovering from daily lows of 1.1547.
EUR/USD increases by 0.22% as market participants uphold an 85% probability of a rate cut by the Fed in December. US jobless claims have decreased once more, while Durable Goods have exceeded expectations, although they are still weaker compared to August figures. ECB officials emphasize a consistent policy approach, stating that additional cuts require more definitive evidence of disinflation.
> The Euro continues to strengthen for a second consecutive day, as expectations for easing remain high, even in the face of robust US economic data and varied statements from the Federal Reserve : The ongoing release of economic data in the US is notable, while dovish remarks from Fed officials are influencing the price movement of EUR/USD. The number of Americans applying for jobless insurance has declined compared to November’s figure, reinforcing the prevailing low-firing and low-hiring conditions highlighted by various Fed policymakers. Additional data indicated that Durable Goods Orders for September surpassed expectations, although they fell short of August’s figures. After the data indicates that the probability of a 25 basis points rate cut at the December meeting remains stable at 85%. Reports shows that JP Morgan has revised their outlook regarding the Federal Reserve’s forthcoming meeting, now anticipating a rate cut in December. In the Eurozone, updates from European Central Bank officials have emerged. Vice President Luis de Guindos indicated that the prevailing rate levels are appropriate. Boris Vujcic stated that “For another cut, you would need to observe the inflation trajectory declining.” Philip Lane stated that in order to maintain inflation at the target level, “we need to see more deceleration in non-energy inflation.” Market participants anticipate that the ECB will maintain its current interest rates for the remainder of the year.
Latest FX Rate Trends : Euro strengthened by dovish expectations from the Fed
- The US Dollar Index, which measures the dollar’s performance against six currencies, has decreased by 0.21%, now standing at 99.57.
- For the week ending November 21, Initial Jobless Claims decreased to 216,000, which is lower than the anticipated figure of 225,000 and a reduction from the previous count of 222,000. Continuing Claims increased to 1.96 million for the week ending November 14, rising from 1.95 million.
- In September, Durable Goods Orders experienced a significant slowdown, increasing by 0.5% month-over-month following a robust 2.9% rise in August. Nonetheless, this outcome surpassed the consensus estimate of 0.3%. Core orders, excluding transportation and defense, increased by 0.9% month-over-month, significantly surpassing the anticipated growth of 0.2%.
- The euro continued to strengthen as US economic indicators pointed to a decrease in inflation, a decline in consumer spending, and growing concerns among households about the labor market, income opportunities, and general financial stability.