EURUSD continues growing while the USD is waiting for stimulus.
The major currency pair is looking up and may continue moving upwards as long as the USD is pressured by the possibility of a new stimulus package for the American economy. The current quote for the instrument is 1.1880.
Yesterday, it became known that the Republicans confirmed their approval of the possibility of a new stimulus package for the US economy. But now it’s $500B, although earlier it was $1-1.5T. The amount of half a billion may even be approved by Donald Trump if required but the American economy needs more considerable support than this.
As a matter of fact, the USD exchange rate is already including this possibility of additional stimulus, and the American currency may continue weakening while policymakers are discussing it. The USD quickly correct right after they finally decide on the exact sum.
According to the statistics published yesterday, the Industrial Production in the USA added 1.1% m/m in October against the expected reading of +1.0% m/m. At the same time, on YoY, the indicator was -5.3% after showing -6.7% in the previous month. The Capacity Utilization Rate was 72.8% in October, which is better than market expectations of 72.3%.
It’s quite interesting that the Manufacturing Production also improved in October – it showed +1.0% m/m.
Yes, the Industrial Production balanced a little bit in October but the growing number of new coronavirus cases in the USA may cause a lot of problems at factories and manufacturing facilities in the future.