The main currency pair grew yesterday by a pattern and a half and right now is still growing towards February’s highs.
After all, the “trip” from the Federal Reserve to the US Dollar was more significant than it was expected. Too “soft” comments from Janet Yellen “cancelled” the commitment of the capital market to play in favor of the “American” and the US Dollar will recover for quite a long time. On the other hand, the mid-term trend is clear and plain. The current quote for the pair is 1.1301; the daily growth is 0.8%.
So, this year the Federal Reserve System is planning to increase the interest rate not four times like it was expected by the stock exchanges, but two. Hence, such “strong” reaction of the market. The first increase might take place in June, but it wasn’t a surprise. The most difficult thing is that “soft” monetary policies are still operating everywhere, despite some isolated tightenings that take place.
Today’s statistics on the Eurozone indicated that in February the CPI in base value increased by 0.8% y/y against the predicted number of 0.7%. Routine calculating of the inflation shows the reduction by 0.2% y/y last month and monthly growth by 0.2%.
The core inflation is some kind of “sterile” indicator and describes how consumer prices would behave without groups of volatile goods. However, anyway, the objective statistics proves that this year the deflation in the Eurozone is relevant again. The EUR/USD pair doesn’t react to the statistics, as there are too many emotions here so far.
RoboForex Analytical Department
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