EUR/USD failed to continue its growth | 28 June 2024

Event to pay attention to today:

15:30 GMT+3. USD - United States Core Personal Consumption Expenditures (PCE) Price Index m/m

EURUSD:

On Thursday, the EUR/USD pair encountered limited supply, yet it continues to gravitate towards a mid-range near 1.0700 as semi-serious traders adjust their positions in anticipation of pivotal US inflation data scheduled for release on Friday. European economic data exhibited a moderate performance during the latter half of the trading week, prompting a shift in focus towards US Personal Consumption Expenditure (PCE) price inflation, which is scheduled for release on Friday during the upcoming US market window.

On Thursday, European data exhibited a moderating trend. The EU economic sentiment indicator fell to 95.9 from a previous reading of 96.0, which was below the projected increase to 96.2. On Friday, the change in the German unemployment rate is expected to show 15k new jobless benefit claimants in June, down from the previous reading of 25k. Meanwhile, the seasonally adjusted unemployment rate is expected to remain unchanged at 5.9% in June.

The number of initial jobless claims in the United States for the week ending 21 June was higher than anticipated, with 233,000 new claims for unemployment benefits filed, compared to the forecast of 236,000. This represents a slight decrease from the 238,000 claims filed in the previous week. The four-week average of initial jobless claims increased to 236,000, which brings the new weekly figure back below the average.

On Thursday, US gross domestic product (GDP) met expectations, with first quarter GDP revised slightly to 1.4% from an initial reading of 1.3%. Core personal consumption expenditures also rose slightly in the first quarter, rising to 3.7% q/q against a forecast of 3.6%. In light of these developments, Thursday's upcoming presidential debate, which begins after the market close, will draw investors' attention as they watch for possible policy hints from the candidates.

Friday's US PCE Price Index reading will be the key indicator of the week, as investors hope for a continued decline in US inflation, which will help the Federal Reserve (Fed) move closer to a rate cut. The current forecast is for core PCE price index inflation to fall to 0.1% m/m in May from 0.2%.

Trade recommendation: We follow the level of 1.0710, when fixing above it we take Buy positions, when rebounding we take Sell positions.

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