US Q4 GDP Overview
Thursday's US economic docket highlights the release of the Advance US Q4 GDP growth figures, scheduled to be published at 13:30 GMT. The first estimate is anticipated to show that the economic growth in the October-December quarter stood at 1.8% annualized pace, slightly higher as compared to the previous quarter's final reading of 1.7%.
As Joseph Trevisani - FXStreet's own Analyst explained: “The decline in consumption from the third to the fourth quarter tilts the risk to the downside for Thursday’s GDP number. The consensus estimate from the Reuters Survey is 2.1% but the Atlanta Fed’s final GDPNow estimate for the period is lower at 1.9%. Either way, the rate of growth will not be far from the prior half-year.”
How could it affect EUR/USD?
Any positive surprise might be enough to reinforce the Fed’s view that that the current monetary policy stance is appropriate and should provide a goodish lift to the US dollar. This might further dent the already weaker sentiment surrounding the EUR/USD pair. Conversely, the market reaction to a slight disappointment might turn out to be rather muted, which further suggests that any attempted recovery by the pair runs the risk of meeting with some fresh supply at higher levels.
Ahead of the important release Pablo Piovano, Editor FXStreet offered important technical levels for the major: “A sustainable breach of the 1.10 mark is needed to intensify the sell-off to, initially, the November’s low at 1.0981. Further south emerges September’s lows in the 1.0930/20 band. The negative view in the spot should remain unchanged below the 55-day SMA, today at 1.1089.”
Key Notes
US Fourth Quarter GDP Preview: The fourth quarter marks time
EUR/USD Forecast: Coronavirus and US GDP could trigger next lower after the Fed breather
EUR/USD Price Analysis: Pullbacks look contained in the 1.0990/80 band
About the US GDP
The Gross Domestic Product Annualized released by the US Bureau of Economic Analysis shows the monetary value of all the goods, services and structures produced within a country in a given period of time. GDP Annualized is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the USD, while a low reading is negative.
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