- EUR/USD STEADIE near 1,1725 support, because the EU is currently saving fresh tariffs in the USA.
- Trump calls on feeding to lower rates, delays the tariff term to August 1.
- Risk appetite disappears like My Mulls Tsariffs for technological and pharmaceutical sectors.
EUR/USD registers minimal profits during a session in North America, because the American dollar erases some of the earlier profits, according to the demand of US President Donald Trump, that the federal reserve reduces interest rates because it delays the date of 9 August. At the time of writing, the pair trads at 1.1724, increased by 0.14%.
Risk appetite became acidic at the end of the day, among uncertainty about commercial policy. According to an interview with CNBC, the Secretary of US trade, Howard Lutnick, said that he was expecting another 15-20 letters in the next few days. In the meantime, Trump threats to broaden the tariffs to pharmaceuticals, semiconductors and copper weighed the mood of investors.
In terms of data, in the United States, the economic DOCT revealed that the trust of diminutive companies fell lower, according to the survey of the National Federation of Independent Business (NFIB).
The joint currency stopped Monday’s losses because the White House was not directed to the European Union (EU) with additional tariffs. Recently, Trump admitted that talks between the USA and Europe are developing, adding that the EU was “very nice” from the USA.
Meanwhile, the American economic document remains absent, and traders look at the issue of the June Federal Open Market Committee (FOMC). In the EU, a lot of officials from the European Central Bank (EBC) will cross the wires led by vice president Luis de Guindos, chief economist Philip Lane and Joachim Nagel.
Daily Digest Market Movers: Euro regains, as Trump said on August 1, the deadline is the final date
- Greenback strength presses on EUR/USD. The American dollar index (DXY), which follows the BUCK value compared to the six currencies basket, ended with Tuesday’s session at 97.51.
- US President Donald Trump has published that the chairman of the Federal Reserve Jerome Powell should now lower the rates after he said that he should give up immediately on the same day. He pushes the date on July 9 to August 1, although he said that he would not extend it. As for the European Union (EU), he said that the EU treats the US very nicely, which is why he refrained from sending a tariff letter.
- Trump added that he could have been sharper in trade and announced that he would impose duties on pharmaceuticals, semiconductors and copper, which, he said, would cause a tariff about 50%.
- A diminutive NFIB optimism indicator dropped to 98.6 in June, slightly below the expectations of 98.7 and a decline from Maya reading by 98.8. The decline was above all an boost in the number of respondents citing excessive supplies.
- According to the EU spokesman, Olof Gill EU stated that there had been some progress under the Framework Trade Agreement with the United States (USA). He pointed out that Ursula von der Leyen called Trump on Sunday, saying that “they had a good exchange.”
Technical prospects for euro: EUR/USD up to 1.1700, when the couple consolidates
From a technical point of view, the couple is neutral, with a well -defined level of support and resistance. The relative strength indicator (RSI), although stubborn, has become flat, which indicates that neither the buyer nor sellers have control.
In order to stubbornly continue EUR/USD, it must tidy the highest level of July 7, 1,1789 before the buyers appointed their monuments at 1,1800. The key resistance lies above the head with an annual (YTD) high level 1.1829.
And vice versa, if EUR/USD falls below 1.1700, it reveals a 20-day straight movable average (SMA) as the first support level of 1.1649. The violation of the latter will reveal the number of 1.1600, followed by a 50-day SMA at 1,1448.
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 boost 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 crucial 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 forceful 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 delicate, 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.
