EUR/USD remains constant, as the US PCE softens, trade voltages sustainable weakness USD

EUR/USD is raised by the US cushioned PCE, but the core inflation remains sticky between 2-3%.
Trump enlivens tension in China, refers to a tariff decision; Trade “Sell America” gains adhesion.
German retail sales are falling, while the chances of lowering the ECB rate increases before meeting the policy on June 5.

EUR (EUR) remains stable compared to the US dollar (USD) on Friday after the personal consumption price indicator (PCE) (PCE) (PCE), which was close to 2% of the target (FED) 2% of the expenditure indicator for a personal, gaining 2%. EUR/USD is trading at 1.1361, practically unchanged during the day.

The market mood remains breakable, shifted between optimism and pessimism, maintaining pressure on US actions due to tariffs and commercial messages. The US court in the US ruled that the tariffs were illegal and ordered Washington to raise them within ten days. Nevertheless, the Trump administration appealed against the decision in the Federal Court, which restored most of the obligations imposed on April 2 “Liberation Day”.

President Donald Trump caused a change in moods after finding that China is not obliged to meet the conditions of Switzerland’s trade agreement. He said, however, that he would talk to the Chinese president XI Jinping to speed up the negotiations between Washington and Beijing.

In addition to commercial policy, the adoption of Trump’s “large beautiful bill”, expecting that he will add a trillion dollars to a high fiscal deficit, maintains traders based on assets outside the USA in the so -called “Sell America” trade.

In terms of data, the American schedule revealed that the numbers of PCE are changing in the right direction, but not so that the inflation core of PCE, which remained in a deadline between the 2% and 3% range. Meanwhile, the improvement of consumer moods, as the University of Michigan (UOM) revealed, suggests that American households change a bit hopeful about the economy, despite the inflation jump forecasting.

In the pond, German retail sales fell every month. Inflation in Germany and Spain remains within 2% of the target of the European Central Bank (EBC), which may escalate the chances of reducing the EBC rate at the meeting on June 5.

Daily Market Market Daily EUR/USD stops recovering the American dollar

The US PCE increased by 2.1% y / y, below March by 2.3%. Nevertheless, the preferred measure of Fed, Core PCE inflation, reflected the evolution of the disinfection process, with the printing in April, compared to 2.6%.
In May consumer consumers improved from 50.8 to 52.2, exceeding the estimates of the final reading. It is worth noting that the expectations of inflation have dropped. Within 12 months, waiting fell from 7.3% to 6.6%, and for the next five years they fell from 4.6% to 4.2%.
Federal reserve officials stated on Thursday that monetary policy remains properly set, noting that the assessment of changes in the risk balance associated with the double mandate of maximum employment and price stability.
German retail sales fell in April -1.1% of the mother, below March by 0.9% and estimates by 0.2%. As for inflation, the harmonized consumer price rate (HICP) for May was 2.1% y / y, below 2.2% of April, approaching the target 2% EBC.
Spanish HICP Flash Print for can move from 2.2% to 1.9% y / y, below the EBC target.
Players on the financial market have fully valued the expectation that the ECB would lower the deposit rate by 25 base points (BPS) to 2% at the upcoming monetary policy meeting.

Technical perspectives EUR/USD: They float around 1,1350 non -direction -free

EUR/USD remains upward, but the trend refrained before the weekend. It seems that the bulls lost some impetus due to the lack of overcoming the number 1.14, which could reduce prices to challenge the highest level of April 22 1.1547, before the year (YTD) of 1.1572.

Although the relative force indicator (RSI) indicates that the buyers have control, RSI is lower, it is ready to reach a lower bark below its 50-neutral line.

Therefore, if EUR/USD reaches a daily closure below 1.1350, the pair can drift in the direction of 1.1300. After further weakening, the next level of the floor will be a 20-day straight average movable (SMA) at 1.1272, followed by 50-day SMA to 1.1193.

FAQ euro

The euro is the currency of 19 European Union countries, which belong to the euro area. This is the second most frequently commercial currency in the world behind the American dollar. In 2022, it accounted for 31% of all currency transactions, with an average daily turnover of over USD 2.2 trillion per day. EUR/USD is the most rotating currency pair in the world, which is about a 30%discount on all transactions, followed by EUR/JPy (4%), EUR/GBP (3%) and EUR/AUD (2%).

The European Central Bank (EBC) in Frankfurt, Germany is a bank reserve bank. EBC sets interest rates and manages monetary policy. The main mandate of the ECB is to maintain price stability, which means either controlling inflation or stimulating growth. Its main tool is to escalate or reduce interest rates. Relatively high interest rates – or waiting for higher feet – will usually bring the benefits of the euro and vice versa. The ECB Managing Council makes decisions regarding monetary policy at meetings taking place eight times a year. Decisions are made by the heads of national banks of the euro area and six enduring members, including the President of EBC, Christine Lagarde.

Data on inflation in the euro area, measured by a harmonized consumer price indicator (HICP), are an essential econometric for the euro. If inflation increases more than expected, especially if it is above the target 2% EBC, it obliges EBC to raise interest rates to restore it to control. Relatively high interest rates compared to its counterparts will usually benefit the euro, because it makes the region more attractive as a place for global investors to park their money.

The data release the health of the economy and can affect the euro. Indicators such as GDP, PMI production and services, surveys regarding employment and consumer moods can affect the direction of the common currency. A powerful economy is good for the euro. It not only attracts more foreign investment, but can encourage EBC to set interest rates, which will directly strengthen the euro. Otherwise, if economic data is faint, the euro will probably fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are particularly significant because they constitute 75% of the euro area economy.

Another significant issue of data for the euro is the commercial balance. This indicator measures the difference between what the country earns on exports and what spends on imports in a given period. If the country generates a highly sought after export, its currency will gain value only from additional demand created by foreign buyers trying to buy these goods. Therefore, a positive net trade balance strengthens currency and vice versa for a negative balance.