Should We Keep an Eye on the Euro, Which Is Showing Signs of Strength Against the U.S. Dollar?
20.01.2022
- Turkey: TCMB Policy Rate and Statement Release
- Europe: ECB Releases Minutes of December Governing Council Meeting
Yesterday, the three major U.S. stock indices all fell toward the close, creating a risk-off sentiment characterized by falling stock prices, lower crude oil prices, and falling interest rates.WTI crude oil fell to $84.9. Amid a general downtrend in the commodities market, gold rose about 1.5% to $1,842 per troy ounce.
In the foreign exchange market, the EUR/GBP pair—which involves two European currencies—is in a tight range, trading within a very narrow band between 0.831 and 0.834.From a long-term perspective on the daily chart, the euro/pound pair has been forming lower highs and lower lows. Since there is no support until the weekly low of 0.829, investors should be wary of a further decline. Meanwhile, the euro is showing signs of strength against the U.S. dollar.
Today, the German Producer Price Index will be released at 16:00, the Eurozone Consumer Price Index (final reading) at 19:00,at 8:00 PM, the TCMB policy rate and statement from Turkey; at 9:30 PM, the release of the minutes from the December ECB Governing Council meeting; at 10:30 PM, U.S. initial jobless claims and the U.S. Philadelphia Fed Business Outlook Index;at 24:00, U.S. Existing Home Sales; at 24:30, U.S. Weekly Natural Gas Inventories; at 25:00, U.S. Weekly Crude Oil Inventories; and at 6:30 the following day, the New Zealand Manufacturing PMI are scheduled for release.With the release of the ECB Governing Council minutes approaching, we will be watching to see if European currencies experience significant price movements.
Author: Keisuke Sakurai
