EUR/USD Forecast, Technical Analysis, Outlook ► preview of the main events that move Euro/Dollar during the week. Here is some general information. Scroll down for the latest EUR/USD forecast.
Euro/dollar is the world’s most popular currency pair for both institutional and retail traders. The euro is the common currency of 19 European countries that vary quite a bit from each other. The key countries are Germany, France, Italy and Spain. The US dollar is the reserve currency of the world.
Germany’s exports and high trade surplus mean that funds are flowing into the euro area. When speculation is not rife, this influx pushes the common currency higher. However, the eurozone has its share of economic and political issues.
The euro debt crisis engulfed Greece, Portugal, Ireland, Italy, and Spain. While the worst may be behind us, it is always looming. Thanks to the leadership of the European Central Bank and President Mario Draghi, the project survived. His “whatever it takes” speech in July 2012″ was a turning point. The diverse countries are linked by a monetary union but not a fiscal one, and this remains the Achilles heel.
EUR//USD trading is often choppy, especially when it is confined to narrow ranges. When the pair is in trend, past technical lines, even those from 2003, are respected quite nicely.
EUR/USD recent moves
The euro-zone economies are growing at a robust pace in 2017. Unemployment is falling and even core inflation is finally rising. All this has led to optimism that sent the euro higher.
The European Central Bank is set to trim its bond-buying scheme (QE) in early 2018. Draghi tried to talk down the currency but to no avail. A weaker euro makes exports more attractive and pushes imported inflation higher. Reports about halving the volume to 30€ billion / month have circulated.
The victory of Emmanuel Macron in France unleashed the upside in the pair: the wave of populism has probably peaked. Nevertheless, politics remain problematic, especially with the fractured parliament in Germany. and this weighs on the euro.
In the US, hopes for fiscal stimulus faded early in the year, but are now on the rise again, with Trump’s tax plan. The Federal Reserve has maintained its plan for three rates hikes in 2017 despite lower US inflation.