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Forex Fundamental Analysis & Forecast by RoboForex

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  • EURUSD remains active. Overview for 11.06.2021

    EURUSD continues consolidating as there arenā€™t enough drivers for more active movements.

    The major currency pair is slowly rising on Friday but the sideways channel keeps prevailing. The current quote for the instrument is 1.2188.

    During its June meeting, the European Central Bank kept its monetary policy completely intact. The benchmark interest rate remained unchanged and the tone of the ECB Governor Christine Lagarde was rather neutral. She said that inflation in the region remained quite moderate but the regulatorā€™s new forecasts indicated that the core inflation was slowly increasing. According to the ECB, the core inflation must be below its targets throughout the entire forecast period.

    In the last several months, inflation in the Euro Area boosted due to several factors, such as the price surge for energies. In the second half of 2021, inflation is expected to continue growing but may later drop after temporary factors disappear.

    The ECB believes that friendly financing terms are very important during the period of recovery from the coronavirus pandemic. Such terms are necessary for supporting economic activity and maintaining mid-term price stability.

    According to the regulator, early tightening of financial terms will lead to the same in morу global lending terms and threaten both inflation prospects and the entire economic recovery, thatā€™s why interest rates will remain at their current levels or lower until the ECB sees that inflation gets close to 2%.

    The USA published inflation reports, which gave pause for thought. For example, the CPI showed 0.6% m/m in May after being 0.8% m/m in the previous month. On YoY, the indicator showed 5%, which is the highest reading since August 2008. The indicator might have increased so much due to wage indexationŠ± as well as the growth of unstable index components, such as food, energies, etc.

    The inflation issue might well be the reason that will force the US Fed to change its rhetoric on interest rates and monetary policy during the next meeting.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.


    • The USD rose pretty much. Overview for 14.06.2021

      EURUSD dropped due to invertorsā€™ confidence about low interest rates in Europe.

      The major currency pair is rather restrained on Monday but the ā€œgreenbackā€ is more favored so far. The current quote for the instrument is 1.2114.

      The Euro plunged earlier after the ECB confirmed its intentions to keep the benchmark interest rate low for a long time. at the same time, it seemed like market players decided to ignore the inflation boost in the USA because everyone said it was temporary.

      The European regulator didnā€™t say anything new for investors but any additional indications to that make them nervous. After the June meeting, one of the ECB policymakers once again said that the flexible monetary policy may require several years and these comments didnā€™t make market players happy.

      The statistics published by the USA last Friday showed that the University of Michigan Consumer Sentiment was 86.4 points in June after being 82.9 points the month before. This was another thing that supported the USD.

      This week, there will be a lot of important information, such as the US price data, and FOMC rate decision and economic projections. Itā€™s going to be very important because a lot may change in light of the recent inflation boost. If there are any hesitations on the part of the Fed compared to its usual stance, the ā€œgreenbackā€ may strengthen.

      Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.


      • EURUSD continues recovering. Overview for 15.06.2021

        EURUSD is slowly regaining positions; market players are inactive in anticipation of the Fed meeting.

        The major currency pair continues growing slowly. The current quote for the instrument is 1.2140.

        There were no American statistics yesterday but the Euro Area reported on the Industrial Production, which added 0.8% m/m in April after expanding by 0.4% m/m in the previous month.

        Investorsā€™ undivided attention is now switching to the June meeting of the US Federal Reserve, which is scheduled to start today and last the next couple of days. The regulatorā€™s ultra-soft monetary policy is very likely to remain unchanged. The USD may find some support in any slight hint at the Fedā€™s intentions to close the stimulus program ahead of the schedule. At the same time, itā€™s quite clear that the regulator is not going to rush such a decision, even considering the inflating boost that happened recently.

        It will be very interesting to hear comments on the current economic state and the outlook for the key macroeconomic parameters. Everything that may prove to be optimistic will provide support to the ā€œgreenbackā€.

        In addition to that, today the USA is going to publish some data that market players may find interesting to analyze. For example, the Retail Sales, the PPI and the Core PPI, as well as the Capacity Utilization Rate for May. Taken together, these reports may provide insight into the retail sales dynamics and the ability of businesses to expand.

        Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.


        • The Pound managed to recover. Overview for 16.06.2021

          After a couple of days of falling, GBPUSD corrected based on the strong statistics.

          The British Pound rose against the USD for the first time over the last three trading sessions. The current quote for the instrument is 1.4115.

          The statistics published earlier this morning turned out to be interesting and quite strong. It seemed to be the reason aby the British currency managed to reverse.

          The Consumer Price Index in the United Kingdom showed 2.1% y/y in May after being 1.5% y/y in the previous month and against the expected reading of 1.8% y/y. The Core CPI was 2.0% y/y after being 1.3% y/y the month before.

          The RPI showed 3.3% y/y in May after being 2.9% y/y in April. The PPI Input was 1.1% m/m, while the PPI Output showed 0.5% m/m ā€“ both readings are better than expected.

          The price environment is becoming tighter ā€“ consumers are back to their normal lives and energy prices are growing each day.

          The Bank of England is highly unlikely to do anything about it in the nearest future. The regulatorā€™s stance will remain unchanged even if it snows in June: the inflation boost is temporary and everything else will be just as expected.

          Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.