Forex - EUR/USD weekly outlook: September 27- October 1

Published 09/26/2010, 11:42 AM
EUR/USD
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Investing.com – The week ending September 24 saw the euro surge to its highest level against the U.S. dollar in five months after soft U.S. data fuelled concerns that the U.S. economic recovery is faltering.

EUR/USD hit 1.3490 at the close of trade on Friday; the pair's highest since April 20, having jumped 3.19% over the week.

The pair is likely to find support at 1.3247, last Wednesday's low and resistance at 1.3665, the high of April 15.

On Friday, official data showed that U.S. durable goods orders declined in line with expectations in August, while new home sales were flat over the month.

The data weakened the U.S. dollar amid concerns that the Federal Reserve may begin another round of asset purchases, known as quantitative easing to bolster flagging U.S. growth and reduce the risk of the U.S. falling into deflation.

The euro was also boosted after data released Friday showed that Germany's Ifo business climate index rose unexpectedly in September, rising to hit a 3-year high.

Next week, the U.S. is to release key weekly data on initial jobless claims as well as data on unemployment, consumer confidence and manufacturing. The country is also to release final GDP data while Federal Reserve chief Ben Bernanke is to speak at two public engagements.

In the euro zone, Germany will dominate economic releases, with data on consumer climate, retail sales and inflation as well as a report on unemployment. Meanwhile, European Central Bank president Jean-Claude Trichet is to speak at two engagements.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect EUR/USD.

Monday, September 27

ECB President Jean-Claude Trichet will begin the week by speaking at two engagements. His comments will be closely scrutinized for any clues to the future direction of euro zone monetary policy.

Tuesday, September 28

The U.S. is to publish data on consumer confidence, a leading indicator of consumer spending, which accounts for approximately 70% of all economic activity. The country is also due to release industry data on house prices as well as a report on manufacturing activity in the Richmond area.

Meanwhile, in the euro zone, market research group Gfk is to release a report on German consumer climate. The country is also to produce preliminary data on consumer price inflation, while France is to produce data on consumer spending.

Wednesday, September 29

In the U.S., President of the Federal Reserve Bank of Boston Eric Rosengren is due to speak on the nation’s economy. His comments will be closely scrutinized for any clues to the future direction of monetary policy. The country is also to produce data on crude oil inventories.

Thursday, September 30

The U.S. is to release final data on its gross domestic product, the leading indicator of economic growth. The country is also due to produce key data on initial jobless claims and manufacturing activity in Chicago.

Later in the day, Federal Reserve Chairmen Ben Bernanke is expected to deliver a speech on the U.S. economy. His comments will be closely scrutinized for any clues to the future direction of monetary policy.

Meanwhile, the euro zone is due to produce preliminary data on inflation, while Germany is due to release a report on unemployment change.

Friday, October 1

The U.S. is to end the week by producing key data on personal spending and income, while the University of Michigan is to release revised data on consumer sentiment and inflation expectations. The country is also to release official data on manufacturing conditions, total vehicle sales and construction spending.

The euro zone will wind up the week with key data on the region’s unemployment rate and manufacturing activity, while Germany is to release data on retail sales.

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