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Home / Analytics / Forex analysis & forecasts / Forex Fundamental analysis / The Eurodollar is rising a bit. Overview for 25.04.2016
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The Eurodollar is rising a bit. Overview for 25.04.2016

25.04.2016
The main currency pair started the week with а growth after having been sold for several sessions.

So, sales of the Eurocurrency slowed down. The current quote for the instrument is 1.1256. Frankly speaking, there is no reason for the Euro to be optimistic: there was no news and the statistics from Germany published this morning was quite weak. The instrument is waiting for the next meeting of the US Federal Reserve System planned for this week.

Today’s statistics from Germany indicated the business climate in April was at its very worst. According to the IFo, the indicator decreased up to 106.6 points against the previous number of 106.7. At the same time, the average forecast was in favor of the increase up to 107 points. The components of the report show that the indicator is negative because of sentiments in wholesale and retail trades. Sentiments in construction and industrial sectors remain stable and rather positive.

IFo current conditions in Germany weakened in April as well. The indicator is 113.2 points against the previous number of 113.8, considering it wasn’t expected to change. In other words, the attitude in general is quite neutral, but the fact that the export is weak may be very negative in the long-term perspective.  

And now about the event of the week, I mean the meeting of the Federal Reserve. During their April meeting, American monetary politicians are expected to provide any – express or indirect – references to a possibility of the interest rate increase this May. If the FRS is planning to increase the rate twofold, it will be perfect to do it in May and October for instance, in order to spread tightening of monetary policy throughout the year. Everything that fails to meet the market expectations will influence the EUR/USD pair and other instruments at once.

This week the USA are going to release the report of the GDP in the first quarter. The number is expected to be less that in the fourth quarter last year. Once again, any decrease or difference from the expected values will act as a strong catalyst in the main currency pair.
 
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