Noor Trends News, Technical Analysis, Educational Tools and Recommendations
The EUR/USD reached a fresh four-week high, around 1.0765, but in the last hour, retreated 30 pips, as the New York session come to close, on a positive trading session, courtesy of positive US data. At 1.0735, the EUR/USD is set to record weekly gains of 1.66% amidst a week full of ECB officials’ hawkish commentary as well as mixed US economic data.
Economic Data
US Core PCE rose by 4.9% YoY, lower than March’s 5.1% figure; traders, investors and market participants now wonder whether the Fed would reduce the rate hiking pace and whether hawkish stance would continue.
On Friday, the US Commerce Department unveiled inflation figures for the country. The Fed’s favorite gauge, the Core PCE for April, increased by 4.9% YoY, aligned with forecasts but lower than the March reading. That eased investors’ concerns regarding the aggressive policy adopted by the Fed, with some policymakers including James Bullard, expecting rates to finish in the 3.25-3.50% range.
The University of Michigan’s gauge of consumer sentiment fell to a final May reading of 58.4 from the initial reading of 59.1 earlier in the month, its lowest level in more than 10 years. Economists were expecting a reading of 59.1, according to a Wall Street Journal survey. The May Final Report came in at 58.4, down 6.8 (10.4%) from the April Final. Since its beginning in 1978, consumer sentiment is 31.9 percent below the average reading (arithmetic mean) and 31.1 percent below the geometric mean.
Other Developments
During the European session, the Bundesbank President and ECB member Joachim Nagel said that he believes the first-rate raise move should come in July, with more to follow in the second half of 2022. He added that inflation would not fall overnight, and it could take some time.
During the week, Atlanta’s Fed President Raphael Bostic, usually a hawk, commented that once the Fed is done with 50 bps increases in the June and July meeting, it might pause as they assess the economy’s reaction.
Next week, the Eurozone macroeconomic docket will feature Headline Inflation for Germany and the Euro area. Both headline figures are expected to rise to new highs, but core EU inflation is foreseen to fall to 3.4%. Another event triggering EUR/USD traders’ reaction would be the EU Council Meeting.
The US docket will reveal the May ISM Manufacturing and the Business-related PMIs, Fed speakers, and employment data on the US front.
Also Read
Bitcoin Still Trapped Below USD 30,000
US benefits depend on Pacific trade pact
AUD/USD hits fresh highs on PCE data, ahead of Q1 GDP
Gold steadies around $1850s, hopeful for a catalyst to $1900
USD/CAD’s selling pressure stands around 1.2780s
Food, energy prices could push the globe into recession
Consumer sentiment at 10-year low amid hot inflation
US household spending rises in April
Wells Fargo: US momentum in consumer spending continued into Q2
