- The EUR / USD falls to almost 1,1350 while the US dollar resumes the recovery of the growing chances of de-escalation in the American-Chinese trade war.
- Beijing plans to break additional prices on certain goods from the United States.
- Holzmann of the ECB warns against the structural weakness of the economy of the euro zone.
EUR / USD Transactions decrease approximately 1,1350 during North American negotiation hours on Friday. The main pair of currencies is weakening due to an American dollar recovery movement (USD) in the hope of improving trade relations between the United States (United States) and China.
The United States Dollar index (Dxy), which follows the value of the greenback against six major currencies, resumes its recovery on Friday after correctly corrected nearly 99.20 the day before. The USD index goes to almost 99.65 and aims to break above the weekly summit around 100.00.
The confidence of participants in the financial market that the trade war between the largest powers in the world could defuse has increased because China has reported that it plans to suspend 125% rights on imports of medical equipment and certain industrial chemicals in the United States, Bloomberg reported on Thursday.
This week, the dialogues of the White House expressing optimism according to which Washington and Beijing could conclude an agreement had hopes that the tariff war would be further. On Tuesday, US President Donald Trump said that “Discussions with Beijing are going well” and added that he thought that “they will succeed in an agreement”. For Thursday North American negotiation hours, Trump also said in an interview with Time Magazine that Chinese President Xi Jinping called him. “His name is,” said Trump and added “I don't think it's a sign of weakness in his name.”
On the contrary, China has denied any discussion with the United States. “China and the United States have no consultation or negotiations on prices,” a spokesman for the Chinese embassy said on Friday. He added that the United States should “stop creating confusion”.
A Beijing spokesman also said Thursday that there had been no “economic and commercial negotiations” with the United States, according to Financial Times (FT). He added that the United States must “completely cancel all unilateral tariff measures” if it wants commercial talks.
On the monetary policy front, a choir of decision -makers indicated that an excessive uncertainty due to new economic policies of the American president Trump could harm the economy. Minneapolis Nourished The president of the bank, Neel Kashkari, warned Thursday that the uncertainty posed by the policies of the president could lead to “commercial dismissals”. Kashkari has excluded the possibility that companies have started to reduce the workforce, but have warned that some companies indicate that they are preparing for “possible job features if uncertainty is continuing”.
Daily Digest Market Movers: EUR / USD Drops, BEC Dovish Bots Swell
- EUR / USD fall due to the USD strength. The Euro (EUR) is faced with its large peers, with the exception of North American currencies, even on Friday, even if the dominant bets of the European Central Bank (ECB) are bloating due to increasing concerns that the inflation of the euro zone could underpin the objective of the central bank of 2%.
- On Thursday, the decision -maker of the ECB and governor of the Finnish central bank Olli Rehn warned against the risks of decline for inflation. “It is entirely possible that projections for medium -term inflation in current circumstances are much lower than the target of 2%,” said Rehn away from spring meetings of the International Monetary Fund (IMF) and the World Bank. Rehn has confidently expressed that current situations “justify a drop in interest rates in June”.
- During European negotiation hours, the decision -maker of the ECB and the Governor of the Central Bank of Austria, Robert Holzmann, showed concerns about the structural weakness of the continent. Holzmann expects the economic shock fears to remain intact despite the prices announced by Donald Trump. “I see economic scars even if the prices are lowered”, “ Said Holzmann. Such a scenario also opens the way to the softening of monetary policy.
- The upcoming Euro trigger would be the big titles of the White House and the European Union (EU) on the potential trade relations between the two sides of the Atlantic.
Euro price today
The table below shows the percentage of Euro variation (EUR) compared to the main currencies listed today. The euro was the strongest against the Japanese yen.
| USD | Eur | GBP | Jpy | Goujat | Aud | Nzd | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.26% | 0.23% | 0.81% | 0.05% | 0.32% | 0.60% | 0.40% | |
| Eur | -0.26% | -0.04% | 0.56% | -0.23% | 0.05% | 0.35% | 0.12% | |
| GBP | -0.23% | 0.04% | 0.59% | -0.17% | 0.09% | 0.37% | 0.13% | |
| Jpy | -0.81% | -0.56% | -0.59% | -0.75% | -0.51% | -0.24% | -0.46% | |
| Goujat | -0.05% | 0.23% | 0.17% | 0.75% | 0.19% | 0.55% | 0.31% | |
| Aud | -0.32% | -0.05% | -0.09% | 0.51% | -0.19% | 0.29% | 0.05% | |
| Nzd | -0.60% | -0.35% | -0.37% | 0.24% | -0.55% | -0.29% | -0.24% | |
| CHF | -0.40% | -0.12% | -0.13% | 0.46% | -0.31% | -0.05% | 0.24% |
The thermal map shows the percentage of variations in the main currencies against each other. The basic currency is chosen in the left column, while the quotes motto is chosen in the upper row. For example, if you choose the euro from the left column and move along the horizontal line to the US dollar, the percentage of variation displayed in the box will represent EUR (base) / USD (quote).
Technical analysis: EUR / USD holds the 20 -week key EMA
Friday, EUR / USD at nearly 1,1350. However, the prospects The main pair of currencies remains optimistic because the 20 -week exponential moving average (EMA) is in a sloping greater than around 1.0885.
The 14 -week relative force index (RSI) climbs to levels close to more than 70.00 in the weekly chartThis indicates a strong bullish momentum, but the chances of a correction cannot be excluded.
By raising the eyes, the psychological level of 1,1500 will be the main resistance of the pair. Conversely, the summit in July 2023 of 1.1276 will be a key support for Euro Bulls.
US dollar FAQ
The US dollar (USD) is the official currency of the United States of America and the “de facto” currency of a large number of other countries where it is in circulation alongside local tickets. It is the most negotiated currency in the world, representing more than 88% of all global turnover, an average of 6.6 billions of dollars of transactions per day, according to data from 2022. After the Second World War, the USD took over from the British book as a global reserve currency. For most of its history, the US dollar was supported by gold, until the Bretton Woods agreement in 1971 when the Order stallion left.
The single most important factor on the value of the US dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to reach price stability (controlling inflation) and promoting full employment. Its main tool to achieve these two objectives is to adjust interest rates. When prices are increasing too quickly and inflation is greater than the 2% target of the Fed, the Fed will increase rates, which helps the USD value. When inflation falls below 2% or the unemployment rate is too high, the Fed can reduce interest rates, which weighs on the greenback.
In extreme situations, the federal reserve can also print more dollars and promulgate a quantitative relaxation (QE). QE is the process by which the Fed considerably increases the credit flow in a blocked financial system. This is a non -standard political measure used when credit has dried up because the banks will not lend themselves (by default of the fear of the counterpart). This is a last appeal when the simple drop in interest rates is unlikely to achieve the necessary result. It was Fed's weapon of choice to combat the credit crisis that occurred during the great financial crisis in 2008. It implies the Fed Print more dollars and use them to buy US state bonds mainly from financial institutions. QE usually leads to a lower US dollar.
The quantitative tightening (QT) is the opposite process by which the federal reserve ceases to buy obligations from financial institutions and does not reinvest the principal of the obligations it holds in new purchases. It is generally positive for the US dollar.
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