Euro Trading Sideways Versus US Dollar

Forex News

The euro remains stable against the US dollar, and the pair EUR / USD is trading at 1.2331, gaining 0.06%. Markets in Europe remain shut on Monday for the Easter holiday, while the US markets were to re-open after the Good Friday holiday. Investors are looking ahead to the US Institute for Supply Management’s manufacturing index, which is expected to fall to 60.1.

Eurozone inflation rate fell to 1.1%, below the ECB's target of about 2%. So that, the ECB is unlikely to change monetary policy in the near future. Nevertheless, Bundesbank President Jens Weidmann raised the possibility of a rate hikes, saying that the rate can be increased in mid-2019. The ECB reduced its QE program to EUR 30 billion, and the program is scheduled to wind up in September. Still, if the bank decides to end this stimulus scheme, the euro could improve sharply.

China has implemented retaliatory tariffs of up to 25% on US imported goods, raising uncertainty over the possibility of a trade war between the two countries. The tariffs were in line with a list of potential duties on $3b worth of US products, released two weeks ago in response to Donald Trump’s taxes on steel and aluminum. The US President also promised to levy 25% on $60b in annual imports from China.