Euro Holds Steady Before FOMC Decision
The Euro (EUR) edged slightly higher against the US Dollar (USD) on Wednesday, currently trading at 1.0682. This gain comes despite mixed US economic data.
US Data Paints Mixed Picture
- Weak ISM Manufacturing PMI and Job Openings data signaled a potential slowdown in the US economy, putting some pressure on the Greenback.
- However, positive private sector job growth data from ADP offered some counter-balance.
Fed Decision Looms Large
The focus of the market remains on the upcoming Federal Reserve (Fed) policy decision later today.
- The Fed is expected to maintain a hawkish stance due to persistent inflation and strong economic indicators.
- While not offering updated economic projections, the Fed might acknowledge recent inflation concerns.
- Chair Powell's press conference is highly anticipated, with potential for cautious hints regarding future rate cuts.
Market Expects Delayed Easing
Market expectations have shifted, with a reduced likelihood of near-term rate cuts. The potential start of an easing cycle has been pushed back to September 2024.
EUR/USD Technical Analysis
- The daily RSI suggests ongoing bearish momentum, with a reading of 44.
- However, the MACD shows some positive buying pressure, with flat green bars.
- The EUR/USD remains below its key short-term, intermediate, and long-term moving averages (SMAs), indicating continued selling pressure.
Overall, the Euro's direction hinges on the outcome of the Fed meeting and Chair Powell's commentary.