Will the market wait and see how the euro performs despite the decline in Germany's ZEW economic sentiment index?

Will the market wait and see how the euro performs despite the decline in Germany's ZEW economic sentiment index?

14.08.2024

In the U.S. currency market yesterday, the U.S. dollar became the weakest currency during U.S. trading hours after the U.S. July Producer Price Index, released yesterday, showed a year-over-year decline of approximately 0.4 percentage points from the previous month’s 2.6% to 2.2%. The USD/JPY pair fell from 147.955 to 146.564.On the hourly chart, the price has moved from above the 20-period moving average (MA) to below it. On the 4-hour chart, the price is consolidating at the 38.2% Fibonacci retracement level, which corresponds to the recent high.

European currencies saw the euro strengthen against the yen, despite the German ZEW Economic Sentiment Index for August—released yesterday—coming in at 19.2, a significant drop from the previous month’s 41.8 and well below the market forecast of 34.2.The euro/yen pair rose from 160.616 to 161.815. It has been gradually moving above the centerline of the hourly Bollinger Bands. On the daily chart, it is currently attempting to break through the 10-day moving average (10MA), which is acting as resistance.

Today’s schedule includes South Korea’s employment statistics at 8:00, the RBNZ’s policy rate decision and statement at 11:00, RBNZ Governor O’Hara’s press conference at 12:00, Sweden’s Consumer Price Index, the UK’s Consumer Price Index, and UK retail sales at 15:00,UK Producer Price Index, at 15:30 India’sWholesale Price Index, at 15:45 the French Consumer Price Index, at 18:00 the Eurozone Real GDP, at 20:00 the U.S. MBA Mortgage Applications Index, at 21:30 the U.S. Consumer Price Index, and at 23:30 the U.S. Weekly Crude Oil Inventories.We will carefully monitor the euro’s movements, which have been rising despite the deterioration in Germany’s ZEW Economic Sentiment Index.