EUR/USD: current sweater

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The Euro / Dollar spot formed a figure of sweater On an upward oblique, strengthening the idea that the week that opens will be crucial on the technical front.

Friday, the trades took note of inflation data for the month of August in accordance with expectations. According to the PCE index, inflation flagship of the American federal reserve, consumer prices increased last month, by 2.7% over a year, and 2.9% over one year in underlying data (“Core PCE”). A price evolution that turns out to be online with expectations.

“The favorite inflation measurement of the Fed, the ‘Core PCE’, still does not show a frank acceleration sign, the increases in customs duties explaining only a surplus of inflation of approximately 3 tenths in accumulated. Under these conditions, the Fed will not hesitate to prioritize the stabilization of the labor market compared to inflation if necessary”, advances in economic strategy and economic studies in CPRAM.

Recall that the Fed has resumed, Pianissimo, its monetary relaxation process by a drop of 25 basic points of its main guiding rate on September 18.

“Tuesday evening, Jerome Powell warned against” too sustained “rate drops that would slip inflation. According to him, interest rates are currently” at the right level to react to potential economic developments “. The 25 BPS drop [le 18/09] Was presented as a “precaution” drop to allow the American economy to find it and avoid too much degradation of the labor market “, lights up Grégoire Kounowski, Investment Advisor at Norman K.

To follow in priority the sales of current housing across the Atlantic at 4:00 p.m. and new interventions by Fed members.

On Thursday, the battery of American macroeconomic statistics on the program only strengthened the prudent approach of J Powell in its (very) progressive drop -down rate of guiding rates. In detail, the final data of GDP in the second quarter, came out far beyond the previous estimates, at +3.8% in annualized pace, clearly marked the session. In addition, weekly registrations for unemployment benefits, at 218,000 new units, have rather pleasantly surprised, as well as the dynamics of sustainable goods.

In the customs chapter, the elusive and unpredictable Donald Trump opened a new chapter, and announced Thursday evening a battery of new customs surcharges, with a rate of 100% on imported patented drugs, 25% on imports of heavy goods vehicles and 50% on kitchen cabinets and sinks. Note that most of the customs duties unilaterally decided by the White House since the start of this commercial offensive have been deemed “illegal” by a federal court of appeal.

At midday on the foreign exchange market, the euro was treated against $ 1,1720 approximately.

Key graphics elements

The breakdown of the slaughtered oblique right drawn in black does not put, at this stage in any case, in doubt the power of the upward primary trend, but brings its batch of questioning on the need for consolidation of the pair of currencies. We again issue a neutral opinion on the Eurusd spot.

Medium term

In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on Euro dollar parity (Eurusd).

We will keep this neutral opinion as long as the EURO Dollar (EURUSD) prices are positioned between the USD 1,1608 support and the resistance to 1,1835 USD.

Daily data graphics