- The euro rose on strong EU PMIs, but fell as US PMIs were better than expected.
- The ECB's interest rate decision is scheduled during Thursday's market session, which ends on Friday after US PCE inflation.
- EUR/USD is hampered by the 200-hour SMA.
EUR/USD rose to near-term highs above 1.0930 on Wednesday after European Purchasing Managers' Index (PMI) numbers surprised with upside in manufacturing, but the rough forecast for US PMI data This worsened market sentiment, and EUR/USD rose. The dollar weakened as investors reassessed the day's momentum and returned to the safe-haven dollar (USD), albeit slightly.
Pan-European HCOB PMI was mixed on Wednesday as investors opted to focus on manufacturing PMI, with January PMI manufacturing sector rising to 46.6, up from December's 44.4 to expected 44.8 exceeded. The services PMI fell to 48.4 from 48.8 last time, completely missing the expected rise to 49.0.
US: January PMI results unexpectedly better
The euro (EUR) rose against the US dollar as investors took in the positive manufacturing data, even though the PMI remains in contraction territory below the 50.0 level. EU manufacturing PMI has not exceeded this barrier for almost two years.
US S&P global PMIs generally beat expectations as the US economy continues to outperform forecast models. January's manufacturing PMI rose to an 11-month high of 50.3, returning to growth territory above 50.0 for the first time in four months and easily surpassing December's stable forecast of 47.9.
The US services sector PMI also exceeded expectations, coming in at 52.9, compared to a lower estimate of 51.4 to 51.0. US PMI makes it less likely that the Fed will start cutting interest rates sooner than expected, as a strong US economy causes the Federal Reserve to panic and become less likely to start cutting rates sooner than expected , investors are rebounding again from expectations for rate cuts. The overall market expectation for the Fed's March rate cut is now below 40%, down from about 80% just a month ago, according to CME's FedWatch tool.
ECB Preview: Forecasts for 12 major banks
Another interest rate announcement and monetary policy statement from the European Central Bank (ECB) on Thursday, after ECB policymakers have played a dual role in recent days to dampen market expectations. , markets will be watching closely for an expansion of the ECB's hawkish or dovish stance. Ahead of early interest rate cuts before summer.
The trading week will conclude on Friday with the release of the US personal consumption expenditure (PCE) price index, which is expected to rise from 0.1% to 0.2% month-on-month in December. The annualized figure is expected to rise from 0.1% to 0.2% from December. 0.1% to 0.2%.
EUR/USD technical outlook
EUR/USD rebounded sharply after breaking through the 200-hour simple moving average (SMA) near 1.0895, peaking at a near-term intraday high above 1.0930 before pushing back and ending Wednesday with a familiar It has settled down around the 1.0880 level.
EUR/USD is trading in the congestion zone between the 50-day SMA and 200-day SMA around 1.0925 and 1.0850 respectively, with the pair likely to continue its short-term consolidation between two major technical barriers. It will be.
