EUR/USD Fundamental Analysis – August 20, 2015 – Forecast

Analysis and Recommendations:

The EUR/USD recovered 39 points to trade at 1.1064 as sentiment shifted today and the greenback eased. There is no economic data due in the Eurozone today as traders wait for US inflation data and the FOMC minutes in the North American session.  

”Investors are getting the ultimate scare with uncertainties over China, weakening currencies, and prospects of a U.S. rate increase,” said Jonathan Ravels, chief market strategist at Manila-based BDO Unban Inc. “Investors are repatriating funds and staying out until the dust settles.”

Riskier assets are coming under pressure as China’s economy slows and the Federal Reserve moves closer to its first rate increase since 2006. Minutes of the Fed’s July meeting are due Wednesday. Bloomberg’s commodity index is at its lowest level since February 2002 amid slowing global demand and rising supplies of crude and basic materials.”

The dollar broadly weakened on Wednesday before the release of minutes from the US Federal Reserve’s last meeting, which investors hope will offer fresh clues about the timing for an interest rate hike.

Market were eyeing the Fed minutes, due later on Wednesday, to see if they back up growing expectations of a rate hike as early as next month. The dollar will likely get a boost if the minutes suggest a rate rise is around the corner.

“The minutes are likely to suggest what traders have known from the actual meeting itself,” Vyanne Lai, an economist at National Australia Bank, told Bloomberg News.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Thursday August 20, 2015

Government Bond Auctions

Date Time Country

Aug 19 11:30 Germany Eur 5bn Sep 2017 Schatz

Aug 19 11:03 Sweden Holds bond auction

Aug 20 10:30 Spain Auctions Bonos/Obligaciones

Aug 20 11:30 UK Auctions 4.25% 2036 Gilt

Aug 21 17:30 Italy Announces details of CTZ/BTPei on 26 Aug