EUR/USD Daily Fundamental Forecasts

TARIFFS LATEST

EUR/USD Daily Fundamental Forecasts – December 15, 2017

Colin First

Updated Thu, Dec 14, 2017, 8:12 PM

The focus was on the euro yesterday as the ECB came out with the rate announcement and statement yesterday and it was then followed by the press conference from Draghi. These events turned out to be largely on expected lines and this led to some mild impact on the euro for trading yesterday and at the end of it all, we are now seeing the euro just below the 1.18 region with no specific direction.

EURUSD Weakens Slightly

The ECB kept the rates on hold and this has been the case for quite sometime now and they also made it clear that this is likely to be the case for a long time in the future as well. Then came along the press conference which was the point of interest as Draghi raised the growth forecasts but made it clear that the QE would continue at the current levels till September 2018. The inflation forecasts were also expected to remain at the predicted levels. The extension of the same level of QE was viewed as slightly dovish by the markets though we cannot think of any other alternative for the ECB at this point of time.

They also pointed out that the incoming data has continued to be strong over the last few months. At the same time as the press conference, came along the retail sales data from the US which came in much stronger than expected at 0.8% growth. This along with the slightly dovish ECB led to a weakening of the EURUSD pair which pushed it below 1.18 during the course of trading yesterday and thats where it continues to trade as of this writing.

Looking ahead to the rest of the day, we do not have any major news from the Eurozone or the US for the day and this should mean some consolidation on either side of 1.18 during the day. With us heading into the final couple of weeks of the year, we expect the volatility and liquidity to become lesser and lesser and this should mean that we are going to be stuck in this 200-250 pip range for the rest of the year.

This article was originally posted on FX Empire