Investing.com – Last week saw the euro tumble to a 7-week low against the U.S. dollar amid fears over sovereign debt contagion in the euro zone, before trimming losses as European Union officials worked out the details of a possible loan for Ireland’s stricken banking sector.
EUR/USD hit 1.3446 on Tuesday, the pair’s lowest since September 28; the pair subsequently consolidated at 1.3673 by close of trade on Friday, shedding 0.23% over the week.
The pair is likely to find support at 1.3446, last Tuesday’s low and resistance at 1.3819, November 11.
The euro rebounded from Tuesday’s low to post three days of gains as officials from the EU, the European Central Bank and the International Monetary Fund appeared to make progress on finalizing a loan package to shore up Ireland’s ailing banks.
But the common currency trimmed gains on Friday after the People’s Bank of China announced that it was raising the reserve requirement ratio for banks for the fifth time this year, effectively draining cash from the financial system to order to curb inflation. The move raised fears over a slowdown in the rate of growth in a country that is leading the global economic recovery.
Separately, Federal Reserve Chairman Ben Bernanke on Friday defended the central bank’s quantitative-easing program against criticism that it was intended to devalue the dollar.
The best way to underpin the dollar and support the global recovery “is through policies that lead to a resumption of robust growth in a context of price stability in the United States,” Bernanke said.
He also argued that China and other emerging economies were hampering the global economic recovery by preventing their currencies from strengthening as their economies expanded.
Next week, the U.S. is due to release a slew of data in a week cut short by the Thanksgiving holiday on Thursday, including revised figures on gross domestic product for the third quarter, durable goods orders, and personal income. The country is also to release its weekly report on jobless claims, while the Fed is to release the minutes of its most recent monetary policy meeting.
Meanwhile, the euro zone is to publish key data on German business climate while the president of the ECB is to address the European Parliament. Attention is also likely to remain focused on developments in Ireland.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 22
The euro zone is to begin the week with a report on consumer confidence, a leading indicator of consumer spending. Also Monday, ECB President, Jean-Claude Trichet is to speak in the European Parliament. His comments will be closely watched for clues to the future direction of monetary policy.
Tuesday, November 23
In the euro zone, research group Gfk is to publish data on German consumer climate, a leading indicator of consumer spending. Meanwhile, Germany, France and the wider euro region are each to publish preliminary data on their manufacturing and service sectors. Germany is also to publish revised third quarter GDP data, the leading indicator of economic growth.
The U.S. is to publish revised figures on third quarter GDP. The country is also to publish industry data on existing home sales while the Federal Reserve Bank of Richmond is to publish its manufacturing index. Later in the day, the Fed is to publish the minutes of its November monetary policy meeting, providing an in-depth insight into economic and financial conditions in the U.S.
Wednesday, November 24
In the euro zone, Germany is to publish its Ifo index of business climate, a leading indicator of economic health while later in the day the euro zone is to publish data on industrial new orders, a leading indicator of production.
The U.S. is to release a slew of data ahead of the holidays, with official data on initial jobless claims, a leading indicator of economic health as well as government data on personal spending, durable goods orders and new home sales. The country is also to publish revised data on consumer sentiment and inflation expectations as well as reports on crude oil and natural gas inventories.
Thursday, November 25
Markets in the U.S. will remain closed in observance of Thanksgiving Day.
Friday, November 26
In the euro zone, Germany is to publish preliminary data on consumer price inflation as well as data on import prices, while France is to release consumer spending data. Later in the day, the ECB is to release data on private borrowing and M3 money supply, an important inflationary indicator.
EUR/USD hit 1.3446 on Tuesday, the pair’s lowest since September 28; the pair subsequently consolidated at 1.3673 by close of trade on Friday, shedding 0.23% over the week.
The pair is likely to find support at 1.3446, last Tuesday’s low and resistance at 1.3819, November 11.
The euro rebounded from Tuesday’s low to post three days of gains as officials from the EU, the European Central Bank and the International Monetary Fund appeared to make progress on finalizing a loan package to shore up Ireland’s ailing banks.
But the common currency trimmed gains on Friday after the People’s Bank of China announced that it was raising the reserve requirement ratio for banks for the fifth time this year, effectively draining cash from the financial system to order to curb inflation. The move raised fears over a slowdown in the rate of growth in a country that is leading the global economic recovery.
Separately, Federal Reserve Chairman Ben Bernanke on Friday defended the central bank’s quantitative-easing program against criticism that it was intended to devalue the dollar.
The best way to underpin the dollar and support the global recovery “is through policies that lead to a resumption of robust growth in a context of price stability in the United States,” Bernanke said.
He also argued that China and other emerging economies were hampering the global economic recovery by preventing their currencies from strengthening as their economies expanded.
Next week, the U.S. is due to release a slew of data in a week cut short by the Thanksgiving holiday on Thursday, including revised figures on gross domestic product for the third quarter, durable goods orders, and personal income. The country is also to release its weekly report on jobless claims, while the Fed is to release the minutes of its most recent monetary policy meeting.
Meanwhile, the euro zone is to publish key data on German business climate while the president of the ECB is to address the European Parliament. Attention is also likely to remain focused on developments in Ireland.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 22
The euro zone is to begin the week with a report on consumer confidence, a leading indicator of consumer spending. Also Monday, ECB President, Jean-Claude Trichet is to speak in the European Parliament. His comments will be closely watched for clues to the future direction of monetary policy.
Tuesday, November 23
In the euro zone, research group Gfk is to publish data on German consumer climate, a leading indicator of consumer spending. Meanwhile, Germany, France and the wider euro region are each to publish preliminary data on their manufacturing and service sectors. Germany is also to publish revised third quarter GDP data, the leading indicator of economic growth.
The U.S. is to publish revised figures on third quarter GDP. The country is also to publish industry data on existing home sales while the Federal Reserve Bank of Richmond is to publish its manufacturing index. Later in the day, the Fed is to publish the minutes of its November monetary policy meeting, providing an in-depth insight into economic and financial conditions in the U.S.
Wednesday, November 24
In the euro zone, Germany is to publish its Ifo index of business climate, a leading indicator of economic health while later in the day the euro zone is to publish data on industrial new orders, a leading indicator of production.
The U.S. is to release a slew of data ahead of the holidays, with official data on initial jobless claims, a leading indicator of economic health as well as government data on personal spending, durable goods orders and new home sales. The country is also to publish revised data on consumer sentiment and inflation expectations as well as reports on crude oil and natural gas inventories.
Thursday, November 25
Markets in the U.S. will remain closed in observance of Thanksgiving Day.
Friday, November 26
In the euro zone, Germany is to publish preliminary data on consumer price inflation as well as data on import prices, while France is to release consumer spending data. Later in the day, the ECB is to release data on private borrowing and M3 money supply, an important inflationary indicator.