© Dukascopy Bank SA
The EUR/USD has been heading lower since the ECB decision to cut rates in early June; nevertheless, following the recent FOMC minutes, which showed that U.S. policy makers are not going to raise interest rates for a long period of time, the greenback provided the Euro with some room for growth. EUR/USD lost 0.06% to 1.3598 late Friday, but posted a weekly rise of 0.47%, as the U.S. Dollar remained under pressure. This is due to the fact that the Fed also lowered its economic growth outlook for this year to a range of 2.1% to 2.3% from 2.8% to 3.0%, due to unexpected contraction in the beginning of the year as a result of unusually harsh winter weather.
Community members do not expect any surprises from the currency pair this week, as according to the Dukascopy survey the Euro might end the week at 1.3596, slightly changed from the last week's close price. The majority of those polled (60%) share a bearish outlook for the single currency. Rokasltu is among those, who advocate bearish outlook, says that "Taking into account that Fed continues with tapering as planned and the ECB is concerned about the EUR exchange rate and ready to implement further measures to combat low inflation, I think EUR/USD rate will gradually go down. During this week I think it descends a little towards 1.35 level." In contrast, aslamhammad expect that "USD/CHF to come down after Swiss interest rate, thus that should have a correlated impact on EUR/USD. Hence, my sentiment for EUR/USD is bullish at the moment".
This week the pair will be driven by a bunch of fundamental news both from the Eurozone and U.S., which might show that economic recovery in the Euro area falters, while the U.S. economy continues to gather steam.
© Dukascopy Bank SA