Should investors be wary of the euro's direction as it weakens against the yen?
08.12.2022
- Remarks by Koji Tsuki, Deputy Governor of the Bank of Canada
- Hungary: Consumer Price Index
In yesterday's U.S. currency markets, the U.S. dollar weakened against the euro, with the EUR/USD pair rising from 1.0442 to 1.0548. From a technical perspective, the EUR/USD pair has entered an ascending pennant pattern on the 4-hour chart, characterized by lower highs and higher lows. Therefore, it will be worth watching to see if the pair breaks out of the ascending pennant after a period of consolidation.
Despite the fact that the final figures for the eurozone’s third-quarter GDP, released yesterday, rose to 0.3% from the market forecast of 0.2% and exceeded the previous reading, the euro fell against the yen.The EUR/JPY pair fell to 143.260 before trading around 143.500 during today’s Asian session. On the daily chart, the pair continues its downward trend with the 20-day moving average acting as resistance, so caution is advised regarding further declines during European trading hours.
Today’s economic indicators include: Sweden’s housing prices at 4:00 PM, Hungary’s CPI and trade balance at 5:00 PM, South Africa’s Q4 consumer confidence index at 5:00 PM, South Africa’s current account balance at 6:00 PM, South Africa’s manufacturing output and Canada’s leading economic index at 8:00 PM, and the Eurozone’sremarks by ECB President Lagarde, Brazil’s retail sales, and Mexico’s CPI; at 10:30 PM, U.S. initial jobless claims and remarks by SNB Board Member Meckl; at 12:30 AM, U.S. weekly natural gas inventories; and at 2:30 AM, remarks by BOC Deputy Governor Kozitsky. We should remain vigilant regarding the direction of the euro, which is currently weakening against the yen.
Author: Keisuke Sakurai
