EUR/USD – Euro steadies, key U.S. consumer data next

After three losing sessions, EUR/USD has steadied on Friday. Currently, the pair is trading at 1.1225, up 0.01% on the day. On the release front, it’s a busy day on both sides of the pond. In Germany, retail sales slowed to 0.9%, but beat the estimate of -1.0%. Unemployment claims fell by 7,000, shy of the estimate of 10,000. The unemployment rate for March dipped to 4.9% from 5.0%, the lowest level since reunification in 1990. In the U.S., consumer data will be in focus, with the release of Core PCE Price Index, Personal Spending and UoM Consumer Sentiment.

Investors are keeping a close eye on the ebb and flow of the U.S.-China trade talks, which continues to affect the movement of currency markets. The negotiations between the sides continues and there have been reports of progress. However, optimism waned on Thursday, after a senior U.S. official said that it could be months before a deal is reached. These remarks have raised risk aversion and boosted the dollar.

Global trade tensions have weighed on inflation levels in the developed economies, and the U.S. is no exception. However, with the Fed saying it will put a hold on rates until 2020, could that change? At the Fed policy meeting, policymakers lowered their inflation forecast for 2020, citing weakness in the Chinese and European economies. However, the chief economist of Credit Suisse, James Sweeney, has taken a different tack, saying that U.S. inflation could climb as high as 2.3% next year, in response to the lack of rate hikes. Sweeney said that although inflation remains below the Fed target of 2.0%, there are signs in the services sector of inflation picking up.

A risk rally built on hope

EUR/USD Fundamentals

Friday (March 29)

• 3:00 German Import Prices. Estimate 0.5%. Actual 0.3%
• 3:00 German Retail Sales. Estimate -1.0%. Actual 0.9%
  
• 3:45 French Consumer Spending. Estimate 0.2%. Actual -0.4%
  
• 3:45 French Government Budget Balance. Estimate -36.9
• 3:45 French Preliminary CPI. Estimate 0.9%. Actual 0.8%
  
• 4:55 German Unemployment Change. Estimate -10K. Actual -7K
  
• 6:00 Italian Preliminary CPI. Estimate 0.3%
• 8:30 US Core PCE Price Index. Estimate 0.2%
• 8:30 US Core Personal Spending. Estimate 0.3%
• 8:30 US Personal Income. Estimate 0.3%
• 9:45 Chicago PMI. Estimate 61.1
• 10:00 Revised UoM Consumer Sentiment. Estimate 97.8
• 10:00 Revised UoM Inflation Expectations
• 12:00 US FOMC Member Quarles Speaks

*All release times are DST

*Key events are in bold

EUR/USD for Friday, March 29, 2019

EUR/USD for March 29 at 5:30 DST

Open: 1.1224 High: 1.1239 Low: 1.1222 Close: 1.1225

EUR/USD Technical

EUR/USD ticked higher in the Asian session and is showing limited movement in European trade

• 1.1212 is a weak support level. It could break on Friday
• 1.1300 is the next resistance line
• Current range: 1.1212 to 1.1300

Further levels in both directions:

• Below: 1.1212, 1.1120 and 1.1046
• Above: 1.1300, 1.1434, 1.1553 and 1.1610

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