Single Currency Marked Mild Gain After PMI Reports
The single currency has slightly increased. Euro/Dollar pair was up 0.15% to close at 1.2443. German Manufacturing PMI indicated 61.1. The Eurozone Manufacturing PMI dropped to 59.6. Today, we’ll get US jobless claims and ISM Manufacturing PMI. Tomorrow, the Eurozone will feature Purchasing Price Index and the US will present wage growth, nonfarm payrolls and the unemployment rate.
Eurozone Consumer Price Index Estimate dropped to the half a year-minimum of 1.3%. Considering the incoming data, Eurozone inflation remains at low levels, which favors the extension of ECB asset purchase program. The program is prolonged to September and Mario Draghi assured that rate hike will only be executed after it’s over, despite continuing speculations about policy tightening. The President added that it might be increased or extended even further.
The greenback has been slightly buoyed by yesterday’s Fed meeting and the following statement. As expected, the rate was maintained at 1.25-1.5%. The statement marked positive outlook of the employment growth, household spending and business fixed investment. Moreover, members was some improvement in inflation. March rate hike is now priced in 80% odds (up from yesterday’s 74%). Some analysts even price in 90% chance. The meeting also marked the last appearance of Janet Yellen as the Fed Chair, as starting from now, the position is taken over by Jerome Powell.