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Forex - EUR/USD weekly outlook: April 5-9

Published 04/04/2010, 05:59 AM
EUR/USD
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Investing.com – The euro staged a slight rebound against the U.S. dollar last week as fears over Greece's debt crisis abated, only to erase most of its gains in the wake of Friday's report on U.S. nonfarm employment.

EUR/USD hit 1.3591 on Thursday, its highest since March 19, but pulled back to reach 1.3499 at the close of trade on Friday. The pair is likely to find support at 1.3267, the low of March 25, and resistance at 1.3818, the high of March 17.

The United States is set to release additional key economic data next week, including a report on pending home sales, a purchasing managers' index for non-manufacturing industry and a report on unemployment claims. The Federal Reserve is also due to release the minutes of its most recent meeting, and Fed chairman Ben Bernanke is scheduled to speak at a number of public forums.

The European Central Bank, meanwhile, is due to announce its key interest rate decision and publish a statement on the economic conditions that led to it. Important euro zone data will also be released on investor confidence; the services sector; gross domestic product; German factory orders; and the trade balances of France and Germany. The ECB President, Jean-Claude Trichet, is also set to speak at a number of public engagements.

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

Monday, April 5

Markets will be closed as many countries hold bank holidays to mark Easter Monday, including euro zone nations France, Germany and Italy, among others.

Meanwhile, an industry group in the U.S., the Institute for Supply Management, will release its non-manufacturing PMI, a leading indicator of economic health. The U.S. National Association of Realtors will also publish a key report on pending home sales.

Tuesday, April 6

The Sentix research group will release a monthly report on investor confidence in the euro zone. This is seen as a key indicator of economic health, since investors and analysts are highly informed by virtue of their job, and changes in their sentiment can be an early signal of future economic activity.

Also Tuesday, the Fed will publish the minutes of its Federal Open Market Committee's latest meeting, providing in-depth insights into the economic conditions that influenced its decision on where to set interest rates.

Wednesday, April 7

Markit will publish final monthly services PPI data for the euro zone, and the European Union will release PPI data for both goods and services. The EU will also release a final quarterly GDP report. Later, Germany's central bank will publish data on German factory orders, a leading indicator of production in the euro zone's largest economy.

Bernanke, the Fed chairman, is later due to deliver a speech titled "Economic Challenges: Past, Present, and Future" at a conference in Dallas. Traders will likely scrutinize his comments for clues to future monetary policy shifts.

Thursday, April 8

France will publish its budget balance, the difference in value between the central government's income and spending for the year-to-date. The county will also release a report on its trade balance, the difference in value between imported and exported goods. The EU will also publish monthly data on retail sales in the euro zone, and Germany will release a report on industrial production.

The European Central Bank, meanwhile, will announce its decision on its minimum bid rate, the bank's benchmark interest rate, after which it will hold a press conference during which Trichet is set to cover in detail the factors that affected the rate move and other policy decisions, such as the overall economic outlook and inflation.

Later in the day, the U.S. will release a closely watched report on initial jobless claims, an important signal of overall economic health.

Friday, April 9

Germany will publish a report on its trade balance, and France will publish monthly data on industrial production.

Bernanke is due to deliver a speech titled "Economic Policy: Lessons from History" at an event in Washington DC. Trichet, meanwhile, is scheduled to deliver a speech titled "Shaping a New World: Economic Crisis and Global Governance" at the L. Bocconi University in Milan.

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