No bad trade news and an EU agreement are good for EUR/USD

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Nick
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No bad trade news and an EU agreement are good for EUR/USD

Сообщение Nick » 29 июн 2018, 14:10

The EUR/USD jumped after EU leaders reached an agreement on migration.

US data, trade, and end-of-quarter flows are set to dominate the scene.

The technical picture remains somewhat bearish for the pair.

The EUR/USD is trading well above 1.1600 once again. The pair jumped around 100 pips and reached 1.1666 on the news that leaders of the European Union reached a deal on migration. The news broke out deep in the European night after long discussions. The pair has consolidated some of its gains in the European morning.

The deal includes a pledge to support frontier countries such as Greece, Spain, and Italy. The new Italian government had an initial tough stance on the topic but was eventually satisfied. The agreement also calls for strengthening the external borders, creating processing centers in Africa and other measures.

While details are still scant at the time of writing, it seems that not only Italy is happy, but also Germany. Chancellor Angela Merkel faced a crisis ahead of the Summit as her Bavarian sister party, the CSU, had significant disagreements with her. They waited for the results of the meeting and their spokesperson said it is a step in the right direction. Even if the party is not fully satisfied, they are not keen on rocking the boat, and this development is positive for the common currency.

The preliminary euro-zone inflation figures for June came out as expected: 2% YoY headline inflation and 1% on the core. The widening gap between both numbers stems from the sharp rise in energy prices, while other prices remain steady.

The market mood is also more optimistic about trade concerns. There have been no new adverse developments in the past day or so. The last significant news was that the US will use the CIFUS institution instead of an emergency law to curb investment. This small change helped stabilize the situation earlier in the week.

Later in the day, the US publishes the Core PCE measure, which is the Fed’s favorite inflation measure. It is expected to pick up, following the Core CPI released earlier this month. More: US Core PCE Preview: One step closer to the Fed’s holy grail

It is also important to note that today is the end of the week, month, and quarter. So, money managers are adjusting their portfolios and this may result in choppy, last-minute movements.

https://www.forexcrunch.com/no-bad-trade-news-and-an-eu-agreement-are-good-for-eur-usd/
8-)

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