The euro is unchanged on Thursday, as EUR/USD is trading at 1.1240. After a quiet few days, there are plenty of events on the schedule. In the Eurozone, Final CPI posted a gain of 0.2%, matching the forecast. Over in the US, there are five key releases, led by Retail Sales and Unemployment Claims. On Friday, the US will release CPI and the UoM Consumer Sentiment report.
There were no surprises from Eurozone CPI data in August. Final CPI remained unchanged at 0.2%, unchanged from a month earlier. The indicator has not risen above 0.3% in 2016, pointing to persistent low inflation levels on the continent. Germany, the largest economy in the Eurozone is also struggling with weak inflation. Final CPI dropped to 0.0% in August, down from 0.3% a month earlier. WPI posted a small gain of 0.1%, but this was enough to beat the forecast of -0.7%. The ECB has been reluctant to adopt further monetary easing, but may have to consider hinting at further action in order to restore market confidence in a Eurozone economy which is beset by weak growth and low inflation.
With a crucial Federal Reserve policy meeting on September 21, the Fed has imposed a blackout period on public comments from FOMC members. This will allow the markets to be completely focused on Thursday’s key releases. The US will publish retail sales, PPI, the Philly Fed Manufacturing Index and unemployment claims. Retail Sales will be closely watched, as a weak reading will likely reduce the odds of a Fed rate hike. Recent comments from Fed officials have been almost contradictory and failed to shed any light on the Fed’s monetary plans. On Monday, FOMC member Lael Brainard sounded cautious, saying it would be prudent to maintain a loose monetary policy. Brainard noted global uncertainties and weak inflation as reasons for the Fed not to rush into raising rates. This dovish message was in marked contrast to remarks from FOMC member Eric Rosengren last week, who came out in support of a rate hike, without providing a timeline. Rosengren said that “tightening is likely to be appropriate”, and went as far as to say that the US economy could overheat if the Fed didn’t act soon. As things currently stand, a September hike has been priced in at 15%, while the likelihood of a December move is 43%.
EUR/USD Fundamentals
Thursday (September 15)
- 8:45 Spanish 10-year Bond Auction. Actual 1.13
- 9:00 Eurozone Trade Balance. Estimate 22.1B. Actual 20.0B
- 9:00 Eurozone Final Core CPI. Estimate 0.8%. Actual 0.8%
- 9:00 Eurozone Final CPI. Estimate 0.2%. Actual 0.2%
- 12:30 US Unemployment Claims. Estimate 262K
- 12:30 US Retail Sales. Estimate -0.1%
- 12:30 US Philly Fed Manufacturing Index. Estimate 1.1
- 12:30 US PPI. Estimate 0.1%
- 12:30 US Core Retail Sales. Estimate 0.3%
- 12:30 US Core PPI. Estimate 0.1%
- 12:30 US Current Account. Estimate -120B
- 12:30 US Empire State Manufacturing Index. Estimate -0.9
- 13:15 US Capacity Utilization Rate. Estimate 75.8%
- 13:15 US Industrial Production. Estimate -0.2%
- 14:00 US Business Inventories. Estimate 0.1%
- 14:30 US Natural Gas Storage. Estimate 57B
Upcoming Key Events
Friday (September 16)
- 12:30 US CPI. Estimate 0.1%
- 12:30 US Core CPI. Estimate 0.2%
- 14:00 US Preliminary UoM Consumer Sentiment. Estimate 91.0
*All release times are EDT
* Key events are in bold
EUR/USD for Thursday, September 15, 2016
EUR/USD September 15 at 10:20 GMT
Open: 1.1245 High: 1.1253 Low: 1.1218 Close: 1.1240
EUR/USD Technical
| S1 | S2 | S1 | R1 | R2 | R3 |
| 1.0957 | 1.1054 | 1.1150 | 1.1278 | 1.1376 | 1.1467 |
- EUR/USD was flat in the Asian session. In European trade, the pair posted slight losses but has recovered
- 1.1278 remains an immediate resistance line
- 1.1150 is providing support
Further levels in both directions:
- Below: 1.1150, 1.1054, 1.0957 and 1.0821
- Above: 1.1278, 1.1376 and 1.1467
- Current range: 1.1150 to 1.1278
OANDA’s Open Positions Ratio
EUR/USD ratio has shown little movement on Thursday, consistent with the lack of significant movement from EUR/USD. Currently, short positions have a majority (59%), indicative of trader bias towards EUR/USD breaking out and moving to lower ground.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Kenny Fisher
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