All Eyes on the Euro as It Faces Pressure from the Strong U.S. Dollar
18.11.2021
- Kansas City Federal Reserve Bank Manufacturing Activity Index
- Bostic (U.S.): Remarks by the President of the Atlanta Federal Reserve Bank
Yesterday, the three major U.S. stock indices all fell, creating a risk-off sentiment characterized by falling stock prices, lower interest rates, and lower crude oil prices.U.S. housing starts for October, released yesterday, came in at 1.52 million units—below the market forecast of 1.579 million—due to material shortages, while housing permits exceeded expectations. Gold rebounded alongside the decline in the U.S. dollar, rising to the $1,866 range.
In the foreign exchange market, the euro/dollar pair—which had been on a downward trend—took a breather, briefly touching 1.126 before rebounding; it is currently trading around 1.133.However, the EUR/USD pair has hit a new low for the year, and from a technical perspective, we should be fully prepared for the possibility that the decline could continue down to the next daily support level around 1.115.
Today’s schedule includes Switzerland’s trade balance at 4:00 p.m., the TCMB’s policy rate announcement and statement at 8:00 p.m., and at 10:00 p.m., remarks by Bostic:Atlanta Fed President’s remarks; at 10:30 p.m., Canada’s international securities turnover, U.S. initial jobless claims, and the U.S. Philadelphia Fed Business Outlook Index; at 11:30 p.m., U.S. Federal Reserve Bank of New York President Williams’President of the New York Fed, at 24:00: U.S. Leading Economic Index, at 24:30: U.S. Weekly Natural Gas Inventories, and at 25:00: U.S. Kansas City Fed Manufacturing Activity Index. We will pay close attention to today’s economic data releases and monitor currency strength and weakness.
Author: Keisuke Sakurai
