EUR/USD Daily Fundamental Forecast – March 20, 2018

The EURUSD pair rebounded off the lows of its range over the last 24 hours as some positive sentiment from the Eurozone and the UK helped to drive the euro higher. This has since helped the euro climb back above the 1.23 region during the course of trading and it is likely to remain buoyed as the market begins to look forward to the Fed.

EURUSD Rebounds

The euro got a boost from the positive outlook of the euro economy and this only further confirmed the growing strength of the Euro economy. This has been happening over the last few months and the positive outlook only served to confirm what was already known in the market. This should push the ECB on an accelerated path for tapering and the ending of the QE and this should further help the euro. The euro also got an unlikely boost from the Brexit process.

It has been reported that terms of the Brexit deal have been almost finalised with only the Irish border deal that is pending as of now. This positive development in the Brexit process has also spurred the euro higher and this, along with the negative sentiment surrounding the dollar, with threat of more tariffs and a global trade war breaking out, has helped fuel the move higher. The G20 meetings seem to have had little impact on the euro but this should be enough to keep the euro bulls busy in the short term.

Looking ahead to the rest of the day, we have the G20 meetings continue on what is scheduled to be the last day of the meetings. Once this is done and dusted, we should see the focus of the markets shift to the Fed later in the week and their associated rate hike for March which is widely anticipated. If the Fed fails to satisfy all the needs of the market, then we are likely to see the dollar slide further in the short and medium term as well.