The euro is showing little movement on Wednesday, as EUR/USD trades in the mid-1.13 line in the European session. On the release front, GfK German Consumer Climate continues to rise and met expectations. In the US, the markets are keeping a close eye on the FOMC Statement, which will be released later in the day.
The Federal Reserve will be in the spotlight on Wednesday, with the release of policy statement at the end of a two-day meeting. The Fed is expected to continue to counsel patience regarding an interest rate hike, and persistently weak inflation means the Fed can take its time before having to make a monetary move. The markets will be combing through the statement and any clues as to the timing of rate hike could shake up a listless EUR/USD.
It’s been strong week for German confidence indicators. GfK German Consumer Climate improved to 9.3 points, edging above the estimate of 9.2 points. The key indicator has now risen for four consecutive releases, as the German consumer remains optimism. This follows an excellent business confidence report. German Ifo Business Climate rose for a fourth straight month, hitting 106.7 points which matched the estimate. This marked a six-month high.
Greece remains in the headlines, as voters gave a sweeping mandate to the far-left Syriza party. Syriza ran on a platform of ending the crushing austerity scheme which Greeks have endured as part of the €240 billion bailout negotiated between and the EU, ECB and IMF. Syriza’s win certainly throws a monkey wrench into the Greek bailout program, but the new Greek government is likely to negotiate a deal with Greece’s creditors. A Greek exit from the Eurozone a most unlikely scenario. Indeed, Greek Prime Minister-elect Alexis Tsipras has promised to keep Greece in the Eurozone. Still, there remains plenty of uncertainty as to what will happen with the bailout plan, so traders can expect events in Athens to have a strong impact on the movement of the euro.
EUR/USD 1.1365 H: 1.1382 L: 1.1326
The Federal Reserve will be in the spotlight on Wednesday, with the release of policy statement at the end of a two-day meeting. The Fed is expected to continue to counsel patience regarding an interest rate hike, and persistently weak inflation means the Fed can take its time before having to make a monetary move. The markets will be combing through the statement and any clues as to the timing of rate hike could shake up a listless EUR/USD.
It’s been strong week for German confidence indicators. GfK German Consumer Climate improved to 9.3 points, edging above the estimate of 9.2 points. The key indicator has now risen for four consecutive releases, as the German consumer remains optimism. This follows an excellent business confidence report. German Ifo Business Climate rose for a fourth straight month, hitting 106.7 points which matched the estimate. This marked a six-month high.
Greece remains in the headlines, as voters gave a sweeping mandate to the far-left Syriza party. Syriza ran on a platform of ending the crushing austerity scheme which Greeks have endured as part of the €240 billion bailout negotiated between and the EU, ECB and IMF. Syriza’s win certainly throws a monkey wrench into the Greek bailout program, but the new Greek government is likely to negotiate a deal with Greece’s creditors. A Greek exit from the Eurozone a most unlikely scenario. Indeed, Greek Prime Minister-elect Alexis Tsipras has promised to keep Greece in the Eurozone. Still, there remains plenty of uncertainty as to what will happen with the bailout plan, so traders can expect events in Athens to have a strong impact on the movement of the euro.
EUR/USD 1.1365 H: 1.1382 L: 1.1326
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