The EUR/USD pair experienced an increase following the release of a disappointing jobs report for February by the US on Friday. It increased to 1.1616 on Monday, rising from the previous week’s low of 1.1530. The pair will attract attention this week amid the escalating conflict and the upcoming release of the latest consumer inflation report from the US. The EUR/USD pair experienced a modest increase following the release of the February jobs report by the US. The Bureau of Labor Statistics reports a decline of 92,000 jobs in February, following an increase of 126,000 jobs in January. Market experts anticipated that the report would indicate the economy added more than 56 jobs.
The report indicated a minor increase in the US unemployment rate, rising from 4.3% in January to 4.4% in February. The data indicates that the labor market is performing worse than anticipated. Consequently, certain Federal Reserve officials, including Stephen Miran and Christopher Waller, will persist in advocating for reduced interest rates. The challenge, however, is that inflation is anticipated to stay at a heightened level as the conflict in Iran persists. Crude oil prices experienced a significant increase following the attacks on energy infrastructure in the region by Israel and Iran. In recent days, there has been a significant increase in the prices of natural gas and various energy products.
Historically, these figures contribute to increased inflation due to their influence on various factors. Consequently, the Federal Reserve may find it challenging to lower interest rates, as doing so could exacerbate the current inflationary pressures in the economy. The next significant report to monitor will be the forthcoming US consumer inflation data, scheduled for release on Wednesday. Analysts anticipate that the upcoming report will indicate a 2.4% increase in the headline CPI for February. The EUR/USD pair has faced significant pressure in recent weeks as investors have sought the security of the US dollar in light of increasing risks. The current position is at the 23.6% Fibonacci Retracement level.
The Supertrend indicator for the pair has shifted to red for the first time since February of this year. The asset has also fallen below the 50-day moving average. The pair is gradually establishing a bearish pennant pattern. This formation consists of a vertical line alongside a triangular configuration. Consequently, the most probable outcome is a continued decline, possibly reaching the psychological threshold at 1.1400. This perspective will be validated if it falls beneath the support level at 1.1533.