EUR/USD Trading Sideways, Staying Limited After ECB Meeting
The euro remains stable against the US dollar. Today, the euro/dollar pair is trading at 1.2298, down 0.07%. The single currency's gains were limited, after European Central Bank President Mario Draghi downplayed a decision to drop the easing bias from last week’s rate statement and warned that increasing protectionism posed a threat to the outlook for growth in the Eurozone.
Last week’s German data were somewhere soft. Factory Orders fell by 3.9% in January, worse than the estimate of -1.9%. This marked the second decline in the past three months. Industrial production fell by 0.1% in January, its second consecutive fall after a dip of 0.5% in December. Economists expected a 0.5% growth.
The US job growth surged in February, recording its biggest increase in more than 1-1/2 years. Nonfarm payrolls jumped by 313.000 jobs last month, boosted by the largest rise in construction jobs since 2007. Average hourly earnings edged up 0.1% in February, a slowdown from the 0.3% rise in January. That lowered the year-on-year increase in average hourly earnings to 2.6% from 2.8% in January. Slow wage growth, however, could temper expectations the Fed will raise its rate forecast to four hikes this year from three.
Donald Trump officially announced the introduction of duties in 25% for steel imports and 10% for imports of aluminum. The EU and China said they would respond in case of imposing taxes on metal imports in the United States. Fears of a global trade war are weighing on the US dollar and the stock markets.