The EUR/USD got stabilized, but major fluctuations are still ahead. Overview for 14.12.2017

The main currency pair stopped skyrocketing by Thursday afternoon, but there will enough reasons for higher volatility later.

The EUR/USD pair was rising significantly yesterday evening and continued rising this morning. By the middle of the trading session, the momentum had been lost, but the evening is expected to be very busy. The current quote for the instrument is 1.1820.

So, the December meeting of the US federal Reserve was calm and quiet. The key interest rate was increased for the third time this year by 25 basis points; now it’s 1.25-1.50%. Seven of nine members of the monetary committee voted for raising the rate, two – against. During the press conference that followed, the Chairwoman of the Federal Reserve, Janet Yellen, said that the attention was slowly switching to the taxation system reform in the American economy. This might be some kind of preparatory phase for her successor, Jerome Powell. Powell is even softer politician than Yellen herself, and the good point is that Trump likes him.

Market expectations relating to the US economy for this year were a bit revised upwards. For the next year, only the Unemployment Rate is expected to improve, up to 3.9%.  

In the evening, the USA reported on the inflation. The statistics matched expectations: the CPI added 0.4% m/m in November after expanding by 0.1% m/m the month before.

The reason why the USD was sold is pretty simple: investors were buying the American currency on expectations and then sold quickly on facts. So far, there hasn’t been much news, but in a couple of hours more information will come – the European Central Bank is having its meeting and investors are waiting for the speech to be delivered by Mario Draghi afterwards.

RoboForex Analytical Department