EUR/USD Daily Fundamental Forecast – September 18, 2017

The EURUSD pair continued to trade in a steady manner on Friday but stayed well within range and did not show much of threatening moves in either direction during the day. This was despite some weakness in the dollar due to the incoming data from the US being lesser than what was expected. But the dollar managed to hold it all together and this helped the pair to stay within range.

EURUSD Stays Within Range

On Friday, the big news was the retail sales data from the US which missed the expectations by counts. This would have piled on the pressure on the already beleagured dollar,under normal circumstances, but none of that seemed to happen on that day. The market was not willing to sell the dollar too much just yet as the data from the US continues to be choppy but showing signs of improvement. Though the PPI and the retail sales data missed the expectations, the inflation data came in stronger than expected and there were too many developments in the US which has basically muddled the waters just a bit.

We have Trump reaching out to the opposition to get his Bills passed, we have rumors doing the rounds on who the next Fed Chief would be, we have news of North Korea continues to build and test missiles and then we have the FOMC this week. A combination of all these presents a very muddled picture for the dollar just yet and it is no longer a straightforward question of whether it is bullish or bearish at any point of time. This is what that seems to be holding the dollar steady.

Looking ahead to the day, we expect the consolidation to continue though we have the final CPI data from the Eurozone scheduled to be released in the London session. We have the FOMC this week and that is likely to hold the markets attention this week. A hawkish FOMC should be good for the dollar in the short term.