It remains to be seen whether the momentum of the euro’s sharp recovery against the dollar will continue

It remains to be seen whether the momentum of the euro’s sharp recovery against the dollar will continue

18.01.2024

In the U.S. currency market yesterday, the U.S. dollar rose against the yen after the release of U.S. December retail sales data showed an improvement from 0.3% in the previous month to 0.6%, with the core index also rising from 0.2% to 0.4%.The USD/JPY pair rose from 147.040, breaking through the key 148-yen level to reach 148.523. It climbed to a level matching last month’s high. However, since the weekly chart shows three consecutive weeks of sharp yen weakness, traders should be cautious of a potential corrective move.

European currencies saw the euro fluctuate against the U.S. dollar after the final figures for the Eurozone’s December consumer price index, released yesterday, remained unchanged from the previous month’s 2.9%, with the core year-on-year rate also holding steady at 3.4%. The euro/dollar pair fell to 1.0846 before rebounding sharply.The rebound continued during today’s Asian trading session, with the pair rising to 1.0903. Notably, the EUR/USD pair rebounded after touching the 75-day moving average. We will be watching closely to see if the euro recovers ahead of next week’s ECB meeting.

Today’s schedule includes Australian employment figures at 9:30, New Zealand’s non-resident government bond holdings at 11:00, Japan’s industrial production at 13:30, Hong Kong’s employment figures at 17:30, the Eurozone’s current account balance at 18:00,EU Construction Output, and South African Mining Production at 11:30; remarks by SNB Governor Jordan at 7:30 PM; Brazil’s IBC-BR Economic Activity Index at 9:00 PM; remarks by Atlanta Fed President Bostic at 9:30 PM;Remarks by Atlanta Fed President Bostic, 10:30 PM: U.S. Housing Starts, U.S. Initial Jobless Claims, U.S. Philadelphia Fed Business Outlook Index, 1:00 AM: U.S. Weekly Crude Oil Inventories, and 3:00 AM: U.S. 10-Year Treasury Auction. I intend to watch closely to see if the momentum of the sharp recovery in the EUR/USD pair will continue.

Past Market Reports

1. 17.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

2. 16.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

3. 15.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

4. 14.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

5. 13.04.2026New

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

6. 10.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

7. 09.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

8. 08.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

9. 07.04.2026

   Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed