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The Euro was not weakening against the Dollar on Wednesday at midday, in a market where risk assets as a whole were showing great resistance, “erasing” their signals from their software, a few weeks ago. hardly, of a new banking crisis.
“The markets now seem to consider the events of March as an epiphenomenon without consequence”, notes François Rimeu, senior strategist, La Française AM, who sees in it “one of the first consequences of a very strong hardening of the conditions after a prolonged period of extremely low interest rates.” For the strategist, “the problems of the world of US regional banks do not seem to us first of all to be completely resolved yet.”
The Fed will therefore have to play the balancing act during the next monetary maturities (FOMC) so as not to brutalize the banking system further, while nevertheless giving a little “slack” to the monetary cord after the publication of PCE (personal consumption expenditures) which have confirmed a slowdown in prices.
A slowdown which will have to be supplemented by consistent signals on both rents and the job market.
On the first point, Emmanuel Auboyneau, Managing Partner, wishes to make the following essential clarification: “the other driving force behind American inflation [en plus du gonflement salarial] is the continuous increase in rents, largely due to a structural housing deficit. There is a tremor in the construction sector which gives hope for an imminent inversion of the curve. The stabilization and then the fall in rents will be a determining factor in controlling US inflation.”
On the second, the week is rich in benchmarks on this point: new JOLTS offers, ADP survey, Challenger job cuts, registrations for unemployment benefits and NFP report culminating on Friday. To follow immediately this Wednesday the results of the survey of the firm in human resources ADP (Automatic Data Processing). The consensus expects 208,000 job creations in the private sector (excluding agriculture) in March.
Also to follow is the ISM services in final data at 4:00 p.m.
At midday on the foreign exchange market, the Euro was trading against around $1.0950.
KEY GRAPHIC ELEMENTS
Around a 50-day moving average (in orange), whose orientation becomes horizontal, the technical messages delivered are progressively dual, without one camp or the other uniting. Opinion is therefore neutral on the flagship currency pair pending a concordant array of clear graphical and technical clues.
MEDIUM TERM FORECAST
In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on the Euro Dollar (EURUSD).
We will keep this neutral opinion as long as the Euro Dollar (EURUSD) parity prices are positioned between the support at 1.0875 USD and the resistance at 1.1045 USD.
The News Bulletin 247 board
CHART IN DAILY DATA
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