EUR/USD Fundamental Analysis December 22, 2014 Forecast

Analysis and Recommendations:

The EUR/USD continued to ease falling 5 points to trade at 1.2281 garnering a bit of support after German PPI printed abit better than expected along with GfK consumer climate.  The dollar again pushed higher against the euro and the yen following Federal Reserve announcement that kept interest rates low and said the US central bank would be “patient in beginning to normalize the stance of monetary policy.” The Fed’s announcement did not accelerate the timing to raise interest rates, expected in the middle of 2015.

Inflation has declined sharply across Europe since end-2011. At present, the 12-month inflation is well below the ECB’s price stability objective in the euro area (EA) and its target in the Czech Republic, Hungary, Poland, and Sweden and to a lesser extent in Romania. In several European countries, the region-wide spell of low inflation has turned into an outright deflation.

German Finance Minister Wolfgang Schaeuble Thursday called on lawmakers to back plans for extending Greece’s bailout program by two months to stabilize the current financial market turmoil. His comments come as Germany’s lower house of parliament is due later Thursday to vote on whether to give Athens extra time for talks with international creditors beyond presidential elections.

As Mario Draghi prepares to push the European Central Bank into quantitative easing, he’s counting the cost of alienating its home nation. With the ECB president signaling that he’ll override German-led concerns on government bond purchases if needed, his institution is under attack

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 actual vs. forecast:

 

Upcoming Economic Events that you should be monitoring:

Monday, December 22nd

Government Bond Auction

Date Time Country Auction

Dec 22 18:30 Italy Announces details of BOT/CTZ auctions on Dec 29

Dec 22 20:00 US Auctions 2-yr Notes

Dec 23 18:30 Italy Announces details of BTP/CCTeu auctions on Dec 30

Dec 23 20:00 US Auctions 2-yr FRN, plus 5-yr Notes

Dec 24 20:00 US Auctions 7-yr Not

Dec 29 12:10 Italy BOT/CTZ auctions

Dec 30 12:10 Italy BTP/CCTeu auctions