EUR/USD – Euro under pressure as Eurozone GDP dips

EUR/USD continues with its losing ways in the Tuesday session. Currently, the pair is trading at 1.1349, down 0.21% on the day. On the release front, Eurozone Preliminary Flash GDP dipped to 0.2%, shy of the estimate of 0.4%. Later in the day, Germany releases Preliminary CPI with an estimate of 0.1%. In the U.S, CB Consumer Confidence is expected to dip to 136.3 points.

The eurozone economy continues to worry policymakers. Economic performance has softened in the third quarter, as Preliminary Flash GDP dipped to 0.2%, down from a 0.4% gain in the second quarter. On an annualized basis, Q3 growth was 1.7%, down from 2.2% in the second quarter. Much of the slowdown can be attributed to the crisis over the Italian budget, which was rejected by the European Commission since it breached EU regulations over debt limits. There was more bad news on Tuesday, as the European Commission reported that economic confidence fell in the eurozone for a tenth straight month. The indicator dropped sharply to 109.8, down from 110.9 points a month earlier.  Confidence is lower in the manufacturing and services industries, and retail services managers reported “much grimmer views on the present and expected business situation”. Economic confidence has fallen in Germany, France and Italy, which could translate into further headwinds for the euro in the fourth quarter.

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EUR/USD Fundamentals

Tuesday (October 30)

  • 2:30 French Flash GDP. Estimate 0.4%. Actual 0.4%
  • All Day – German Preliminary CPI. Estimate 0.1%
  • 3:45 French Consumer Spending. Estimate -0.4%. Actual -1.7%
  • 4:00 Spanish Flash CPI. Estimate 2.3%. Actual 2.3%
  • 4:55 German Unemployment Change. Estimate -12K. Actual -11K
  • 5:00 Italian Preliminary GDP. Estimate 0.2%. Actual 0.0%
  • 6:00 Eurozone Preliminary Flash GDP. Estimate 0.4%. Actual 0.2%
  • 6:14 Italian 10-year Bond Auction. Estimate 3.36/1.5
  • 9:00 US S&P/CS Composite-20 HPI. Estimate 6.0%
  • 10:00 US CB Consumer Confidence. Estimate 136.3

Wednesday (October 31)

  • 3:00 German Retail Sales. Estimate 0.5%
  • 6:00 Eurozone CPI Flash Estimate. Estimate 2.1%
  • 6:00 Eurozone Core CPI Flash Estimate. Estimate 1.0%
  • 8:15 US ADP Nonfarm Employment Change. Estimate 190K

*All release times are DST

*Key events are in bold

EUR/USD for Tuesday, October 30, 2018

EUR/USD for October 30 at 8:00 DST

Open: 1.1373 High: 1.1388 Low: 1.1346 Close: 1.1349

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1120 1.1212 1.1300 1.1430 1.1553 1.1611

EUR/USD edged higher in the Asian session but has reversed directions in European trade and moved lower

  • 1.1300 is providing support
  • 1.1434 is the next resistance line
  • Current range: 1.1300 to 1.1434

Further levels in both directions:

  • Below: 1.1300, 1.1212 and 1.1120
  • Above: 1.1434, 1.1553, 1.1611 and 1.1735

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

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.