EURUSD rises to around 1.0830, although the bearish bias remains strong due to several factors.
In Friday’s North American session, the EURUSD extends its rebound from Thursday to roughly 1.0830. The recovery in the shared currency pair is being led by a retracement in the US dollar (USD). The US Dollar Index (DXY), which measures the value of the US dollar against six major currencies, has extended its drop slightly below 104.00. The US Dollar is under pressure following the release of US Durable Goods Orders, which fell slowly by 0.8% in September, slower than expectations of -1.0%.
Fed projected to follow a gradual rate-cutting cycle.
The US Dollar’s near-term appeal remains strong due to multiple tailwinds, including growing bets on the Federal Reserve (Fed) to follow a more gradual rate-cut cycle and rising expectations that former US President Donald Trump will win the presidential election against current Vice President Kamala Harris.
Investors’ confidence in the Fed’s gradual policy-easing cycle is bolstered by positive Nonfarm Payrolls (NFP) and Retail Sales data for September, as well as better-than-expected flash S&P Global PMI data for October, which pointed to long-term economic growth.
Daily Market movers: EURUSD will influenced by forecasts for the ECB’s expected rate drop magnitude in December.
The Euro (EUR) continued to perform strongly on Friday following the release of Thursday’s flash. Hamburg Commercial Bank (HCOB) Eurozone Purchasing Managers’ Index (PMI) Report for October. Despite the preliminary PMI report revealing that the Eurozone’s economic activity continuing to shrink, with the flash Composite PMI falling to 49.7 in October, the euro stays solid. Preliminary estimates showed that industrial activity continued to decrease, with manufacturing PMI falling below the 50 barrier that distinguishes expansion and contraction for 28 months, while service sector output rose at a slower rate. A steady fall in Eurozone corporate activity indicates uncertainty about economic growth.
Meanwhile, mounting anticipation that the European Central Bank (ECB) may slash interest rates more than usual at its next policy meeting in December is expected to send the Euro back within the woods. This year, the European Central Bank has already cut (PMI) Report for October. Despite the preliminary PMI report revealing that the Eurozone’s economic activity continuing to shrink, with the flash Composite PMI falling to 49.7 in October, the euro stays solid. Preliminary estimates showed that industrial activity continued to decrease, with manufacturing PMI falling below the 50 barrier that distinguishes expansion and contraction for 28 months, while service sector output rose at a slower rate. A steady fall in Eurozone corporate activity indicates uncertainty about economic growth.
European Central Bank (ECB) may slash interest rates more than usual at its next policy meeting in December.
Meanwhile, mounting anticipation that the European Central Bank (ECB) may slash interest rates more than usual at its next policy meeting in December expected to send the Euro back within the woods. This year, the European Central Bank has already cut Prior releases. Historically, increasing market mood indicates a resurgence in economic conditions, but this appears unlikely given to sluggish corporate activity.
