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Home / Analytics / Forex analysis & forecasts / Forex Fundamental analysis / The euro continues attacking the “American”. Overview for 04.02.2016
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The euro continues attacking the “American”. Overview for 04.02.2016

The main currency pair is growing on Thursday after the publication of statistics and comments by Mr. Dudley.

The euro continues to grow in tandem with the US dollar during trading on Thursday. By mid-afternoon, the main currency pair is at 1.1156 (+ 0.5%). Activity in the instrument increased markedly.

Yesterday Mr. Dudley, who noted that the external and internal conditions in finance are now more stringent, did not help the US dollar, saying that an overly strong of the position of the US currency can hurt the US economy. Investors reacted with lightning speed: the tone of the statement gives grounds to reconsider the approach of the Fed to raising interest rates in the future. It is possible that the regulator will take a more cautious strategy as a basis and will not be reviewing increasing the cost of credit too quickly. Naturally, this immediately played against the US dollar.

In the middle of the week, interesting statistics on the index of business activity in the US services from ISM were published. The index in January fell to 53.5 points versus 55.8 points a month before, although some pullback was expected. The deterioration of sentiment in the non-manufacturing sector of the economy may be due to a seasonal factor, but by itself is not the most positive observation to assess the current state of the economy.

Beginning of the month - is the season for the employment market report in the New World. The release from ADP on payrolls in the private sector is already out, and it is positive. Today components of the report will be published in terms of wages and the weekly release of claims for unemployment benefits tomorrow - the X day, when key indicators on the level of unemployment and the NFP will be published. These reports are essential for the currency pairs and the US dollar, and the USD is ready to respond to them. It looks oversold now; it is time to win back the reputational loss.
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