EURUSD:
The EUR/USD exchange rate declined to 1.0415 during Asian trading on Friday, as trading volumes were subdued due to the holiday season. Later on Friday, the preliminary reading of the US goods trade balance for November will be released.
Data released on Thursday by the US Department of Labour showed that weekly initial jobless claims fell to their lowest level in a month last week. The number of Americans filing new claims for unemployment benefits fell to 219,000 in the week ended 21 December, down from 220,000 in the previous week, below the market consensus forecast of 224,000.The Federal Reserve (Fed) has indicated that the pace of interest rate cuts next year will be slower than in the past few months, which could help strengthen the dollar.
Meanwhile, European Central Bank (ECB) Governing Council member Boris Vujcic has stated that the central bank is likely to cut borrowing costs again if incoming data matches its forecasts. The ECB has already cut rates four times this year, bringing the deposit rate to 3.0 per cent, and analysts expect policymakers to continue quarter-point changes until the rate reaches 2.0% in June. This, in turn, could lead to a depreciation of the local currency against the US dollar.
Trading recommendation: We follow the level of 1.0400, when fixing above it we consider Buy positions, when rebounding we consider Sell positions.
Origin: FreshForex
