EUR/USD Daily Fundamental Forecast – June 30, 2017

The EURUSD pair continues to move higher despite the fact that there was a clarification issued that said that Draghi’s comments should not be interpreted as hawkish as the markets have tended to. It is a measure of the weakness in the dollar that despite this, the pair continues to rise and the dollar continues to be weak across the board. Of course, this would probably make Trump happy as he has publicly stated that he would wish the dollar to be weak but the way it is weak should be a matter of concern.

EURUSD Continues Higher As Dollar Suffers

The Trump administration would have been happy if the weakness had happened with a view on achievement of a larger economic purpose but this latest round of weakness is more due to the political mess that is seen in the US which has made policy decisions very difficult. Of course, credit should also be given to the euro which has bounced back strongly over the last few days as the economic data continues to favor a tapering of the QE in the coming months.

The fact that a clarification had to be issued in order to control the euro rise tells us how closely the central banks are watching the rates and how much control they would like to exercise to ensure that the rates are under control. But if the EURUSD pair continues to rise despite this, then it should reflect pretty badly on the dollar. The dollar bulls would be hoping that the latest round of economic data that is scheduled to be released next week would help their cause and show a reversal of the bad data that we have been seeing from the US over the last few weeks.

Looking ahead to the rest of the day, we do not have any major news from the US or the Eurozone but we expect the EURUSD to continue to be well bid during the day.