EUR/USD: Consolidation mode around 1.1300 level remains in play, ahead US inflation data
|The single European currency is trading well above the 1.13 level on the last day of the week, maintaining the consolidation mode, awaiting data on Personal Consumption Expenditures in the United States, which often acts as a harbinger of inflationary pressures and remains one of the Fed's favorite indicators to determine its monetary policy.
Developments on the other side of the Atlantic continue to remain very high on the agenda as President Donald Trump's policies continue to keep investors' interest alive with the latest developments regarding tariffs creating new confusion.
On the one hand, a US court is coming to annul the imposition of trade tariffs, while just yesterday afternoon a federal appeals court suspended this decision.
President Trump's controversial personality, which has caused significant criticism, continues to cause concern, with the calm that has come to international financial markets, and especially to international stock exchanges, likely to be temporary.
The S&P 500 stock market barometer index touched 6,000 points yesterday, having absorbed almost the largest percentage of the losses caused by President Trump's shocking policy of imposing huge tariffs on key trading partners a few weeks earlier.
But now I have many doubts about how long this dynamic will remain on the table, as the agreements that have been temporarily concluded between the United States, Europe and China have a short expiration date and no one knows what President Trump's unpredictable policy will bring to the agenda in the near future.
In such an environment of confusion, the exchange rate is unable to take any direction with investors remaining cautious, avoiding big bets.
The scenario of the pair remaining in the known fluctuation range of recent weeks between levels 1,10 and 1,16 remains on the table with good possibility, with the most significant risk currently threatening the dollar remaining concerns about the course of the US debt.
Today's agenda is quite interesting with various inflation indicators in some Eurozone countries being announced, while on the other side of the Atlantic, as I mentioned earlier, the personal consumption expenditure index and the University of Michigan's survey on consumer Sentiment and Expectations stand out.
Νo change in my thoughts, I remain in a wait-and-see attitude with the potential debt crisis worrying me and scaring me into positioning in favor of the US dollar even though it is clearly favored by higher interest rate.
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