MarketPulse | Nov 28, 2017 06:14AM ET
The euro has started the week with little movement. In the Tuesday session, EUR/USD is trading at 1.1881, down 0.14% on the day. On the release front, there are no major eurozone events. The US releases CB Consumer Confidence, with an estimate of 123.9 points. Fed Chair Designate Jerome Powell will testify at his confirmation hearing before the Senate Banking Committee. On Wednesday, Germany releases Preliminary CPI. The US will publish Preliminary GDP and Pending Home Sales and Janet Yellen will testify before a congressional committee.
In Germany, the political drama continues. There are renewed hopes that another election can be avoided, as the SPD (socialist democrats) have reluctantly agreed to hold coalition talks with Angela Merkel’s CDU. The SPD was the junior partner in the previous government, and is expected to demand a bigger role in a new government if it agrees to a “grand” coalition. Talks between the CDU, the Greens and the Free Democrats imploded when the Free Democrats bolted, saying there was not enough common ground to continue talks. Merkel is reluctant to run a weak minority government, and if talks with the SPD don’t make progress, the likely result would be another election. For its part SPD lawmakers are split on whether to join up with the CDU, but Merkel may choose to make her former coalition partner an offer it can’t refuse, such as the powerful finance minister.
All eyes will be on Jerome Powell, who testifies before the Senate Banking Committee on Tuesday for his confirmation hearing. Will Powell be a clone of outgoing chair Janet Yellen? Powell inherits an economy that is in excellent shape, but persistently low inflation remains a nagging problem. Fed policymakers have differing views on what to do about inflation, with some members proposing that the Fed drop its 2 percent target, in favor of a “gradually rising path” for prices. The Fed remains confounded by low inflation and wage growth, despite a labor market that is at full capacity. Still, the Fed will likely pull the rate trigger next month, and could raise rates up to 3 more times in 2018 if the economy continues to expand at its current pace.
EUR/USD Fundamentals
Tuesday (November 28)
Wednesday (November 29)
*All release times are GMT
*Key events are in bold
EUR/USD for Tuesday, November 28, 2017
EUR/USD for November 28 at 6:00 EDT
Open: 1.1898 High: 1.1920 Low: 1.1880 Close: 1.1881
EUR/USD Technical
S1 | S2 | S1 | R1 | R2 | R3 |
1.1657 | 1.1777 | 1.1876 | 1.1936 | 1.2033 | 1.2108 |
EUR/USD was flat in the Asian session and has edged lower in European trade.
Further levels in both directions:
OANDA’s Open Positions Ratio
EUR/USD is unchanged in the Tuesday session. Currently, short positions have a majority (64%), indicative of EUR/USD continuing to move downwards.
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