Home Forex EUR/USD Tests 1.0900, Fed Minutes Reveal FOMC Still Focused on Fighting Inflation

EUR/USD Tests 1.0900, Fed Minutes Reveal FOMC Still Focused on Fighting Inflation

by SuperiorInvest


  • EUR/USD tested 1.0900 after the release of the latest minutes from the Fed meeting.
  • The euro has been steadily falling against the US dollar on Tuesday.
  • Next up: Wednesday’s US jobless claims, EU consumer confidence.

The EUR/USD dipped into the 1.0900 handle heading into the end of Tuesday’s trading session after the latest Federal Reserve (Fed) minutes from the US central bank’s October 31-November 1 meeting revealed that the Federal Open Market Committee (FOMC) is i remains firmly committed to increase rates fight against forward-looking inflationary expectations.

Markets initially squirmed after the release but remain steady heading into Wednesday’s trading despite a significant tonal mismatch between the hawkish Fed and the markets’ broader appetite for the start of the rate-cutting cycle.

FOMC memo: Further tightening would be appropriate if progress toward inflation target insufficient

with the Fed minutes out of the way, markets will now focus on Wednesday’s US Jobless Claims and November’s EU Consumer Confidence Survey.

Initial US jobless claims for the week ending November 17 are expected to fall slightly to 225,000 from the previous week’s multi-year high of 231,000; 4-week average for Initial Unemployment claims is currently 220.25 thousand

Michigan’s US Consumer Sentiment Index is expected to improve slightly from 60.4 to 60.5 in November, and US durable goods orders are forecast to decline from 4.6% to -3.1% in October. US inflation expectations are as well forecast held steady at 3.2% in November.

On the EU side, consumer confidence is expected to show an improvement, but only slightly: analysts expect a slight increase from -17.9 to -17.6.

Today’s price in euros

The table below shows today’s percentage change in the Euro (EUR) against the major listed currencies. The euro was weakest against the pound sterling.

American dollar euros GBP CAD AUD JPY NZD CHF
American dollar 0.28% -0.23% -0.18% 0.10% 0.00% -0.13% -0.09%
euros -0.29% -0.50% -0.46% -0.21% -0.30% -0.42% -0.38%
GBP 0.23% 0.52% 0.05% 0.31% 0.23% 0.10% 0.14%
CAD 0.19% 0.47% -0.04% 0.26% 0.17% 0.05% 0.09%
AUD -0.10% 0.21% -0.30% -0.26% -0.09% -0.21% -0.15%
JPY 0.00% 0.28% -0.22% -0.19% 0.07% -0.15% -0.08%
NZD 0.13% 0.42% -0.09% -0.05% 0.21% 0.08% 0.04%
CHF 0.09% 0.38% -0.14% -0.10% 0.17% 0.08% -0.04%

The heat map shows the percentage changes of major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change shown in the box will be EUR (base)/JPY (rate).

EUR/USD Technical Outlook

Euro (USD) is currently experiencing an intraday decline against the exchange rate American dollar (USD) is slipping from a weekly high of 1.0965 and trading in the neighborhood of 1.0900. EUR/USD’s near-term momentum has the pair trading to the upside, offering well above the 200-hour simple moving average (SMA), which is rising to 1.0820.

Tuesday’s early recovery saw EUR/USD hit its highest bids since early August, but the pair failed to hold on to the 1.0950 level and slipped back down, but remains firmly bullish. The pair is trading on the north side of the 200-day SMA near 1.0800 and has plenty of room to run until the bears pull the pair down.

On the downside, the Relative Strength Index (RSI) is tapping into overbought territory on daily candles, suggesting that the pullback could find further strength.

EUR/USD hourly chart

EUR/USD daily chart

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