EUR/USD: The Euro is more likely to remain under slight pressure
|The single European currency is trading below the 1,09 level showing signs of retreat after yesterday's economic news where the US economy showed a good pace of growth pleasantly surprising the markets.
The announcement of a 2.9% growth rate in the last quarter beat expectations and now is likely to make it easier for the US Federal Reserve to return to more hawkish rhetoric if inflation pressures on US remain at high levels.
At the same time, other important macroeconomic news were slightly better than estimates for the US economy, which was also reflected in the exchange rate, as it now appears that the European currency is limiting its momentum.
The single European currency has been taken into a defensive mode trying to control and limit a downward trajectory , which something that has succeeded for now , as the dollar momentum which started to appear since yesterday afternoon looks hard to be extended with easy way.
In view of course of the last day of the week and the closing of the markets and ahead of the next stormy week with the announcements of interest rate increases by Fed and Ecb i would hardly expect the pressure to the single currency to take a large dimensions.
Respectively it would be quite a big surprise if the European currency rebounded and again approached the recent highs at 1,0920-30 levels securing high prices and staying there at the close of the day.
The agenda is quite rich today as well with various macroeconomic data announcements from US.
Items such as personal income, personal spending and the University of Michigan Consumer Sentiment Survey are expected to touch the exchange rate.
But as long as there is no surprise in relation to estimates it would be difficult for the pair to break significant levels on the last trading day of the week.
In general I would give an increased chance that the European currency will remain under slight pressure for the rest of the day but would be difficult to get much extend.
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