The Euro is losing customers before ECB meeting
On Wednesday the EURUSD is trading slightly higher after two days of impressive subsidence. On the weekly chart the pair remains in negative territory before the key events of the week – inflation data in the US and ECB meeting.
As for the inflation report forecasts slower growth in consumer prices in November, including due to the reduction in price of oil. From what will be the numbers in today’s report, much will depend on the fed’s policy next week, when the regulator is widely expected to raise the cost of lending for the fourth time this year.
Also it will be interesting to see whether another criticism of trump on the tone of the Central Bank. We will remind, today, the American leader stressed that the fed would be stupid to raise rates at the December meeting.
For the EURUSD pair, which continues to monitor the political developments in Europe, equally important will be the ECB meeting, which will take place tomorrow. In light of the recent deterioration in business activity, there is a possibility of revision of the economic forecasts of the Central Bank towards a small decrease. It is also possible that the controller will try to push back market expectations regarding the first rate hike, which, however, already few expect next year.
A potentially dovish Draghi rhetoric may increase pressure on the single currency, already suffering from what is happening in Italy, France and Britain. By the way, the worsening of the symptoms of the expanding political crisis in Europe can serve as the main reason of further reducing the attractiveness of the Euro.
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