EUR/USD is surging ahead FOMC, ECB policy meetings

The EUR/USD pair is trading near 1.0764 versus earlier low of 1.0742 during the few previous hours as markets prepare for a busy trading week, whether on the data front or on the central banks’ decision-front, that includes US Consumer Price Index data, Producer Price Index data, and the FOMC rate decision.

The market is expected to focus on the hawkish versus dovish tone of Fed and ECB statements. In November, CPI inflation is expected to rise from 0.0% to 0.1%, while PPI inflation is expected to rise from -0.5% to 0.1%.

The US Fed’s latest interest rate decision, which will release its latest Interest Rate Projections, will be the focus. As markets expect the Fed to ease monetary policy and interest rates early next year, investors will be analysing the Fed’s Dot Plot to adjust their positioning.

The ECB’s Monetary Policy Statement is expected to maintain the Deposit Facility Rate at 4%, and markets will try to interpret, or rather to decipher whether the ECB is hawkish or dovish in their latest Press Conference.

The EUR/USD pair is technically flattening on Monday, with the pair cycling around the 1.0750 level. Near-term price action has been confined to the 50-hour Simple Moving Average (SMA), with any bullish recoveries being capped by a descending 200-hour SMA near 1.0840.