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EUR/USD Weekly Analysis Forecast, May 18-22, 2015 – Forecast

Weekly Analysis and Recommendation (EUR/USD Analysis Forecast):

The EUR/USD broke a 3 month high this week to trade at 1.1449 after comments from Mario Draghi and the easing stress over the Greece financial situation as the country made its much anticipated  750 million euro payment to the IMF. Market strategists were chattering non-stop in January about Europe’s economic weakness and deflation concerns. The euro dropped sharply as the dollar was powering forward, but now the trend has reversed as the Eurozone has performed better than expected and deflation concerns have receded.

The US dollar began to fall as lackluster data hit the markets the outlook began to change after Fed economists on March 18 trimmed their expectations for how quickly the central bank will raise interest rates. Before then, expectations of the first increase in borrowing costs since 2006 helped send the dollar up 22 per cent since June. Since mid-April, the dollar has declined by 7% versus the euro and 6% versus the British pound, moving back to levels last seen around January.

The greenback enjoyed its fastest rise in 40 years in the back half of 2014 and early 2015.

Now, the U.S. currency has pared this year’s gains, and bond investors have increased purchases of Treasury Inflation Protected Securities, or TIPS. Crude oil surged 25 per cent in April, the most since May, 2009, and settled at $60.40 on Tuesday.

A gauge of inflation expectations that closely tracks gold is trading near the highest since September. Declines for U.S. jobless claims and gains for manufacturing show why those expectations are increasing, according to Mike Pond, the head of global inflation market strategy at Barclays PLC in New York.

ForexTraq provides in-depth analysis for each currency and commodity we review in forex trading. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information for EUR/USD in our weekly reports and we provide daily updates and outlooks.

eurusd chart

Major Economic Events for the week that you should be monitoring for EUR/USD in forex trading

Cur. Event

Actual

Forecast

Previous

Monday, May 18, 2015

Tuesday, May 19, 2015

  AUD Monetary Meeting Minutes

 

  GBP CPI (YoY)

 

  EUR German ZEW Economic Sentiment

 

49.0

53.3

  EUR CPI (YoY)

 

0.0%

0.0%

  USD Building Permits (Apr)

 

1.065M

1.042M

  CAD BoC Gov Poloz Speaks

 

Wednesday, May 20, 2015

  GBP BoE MPC Meeting Minutes

 

  USD FOMC Meeting Minutes

 

Thursday, May 21, 2015

  CNY HSBC Manufacturing

 

49.4

48.9

  EUR German Manufacturing

 

52.3

52.1

  GBP Retail Sales

 

0.4%

-0.5%

  USD Existing Home Sales

 

5.24M

5.19M

  USD Philadelphia Fed Manufacturing

 

8.2

7.5

Friday, May 22, 2015

  EUR German GDP

 

0.3%

0.3%

  EUR German Manufacturing

 

52.1

  EUR German Ifo Business

 

108.3

108.6

  USD Core CPI

 

0.2%

0.2%

Government Bond Auctions

Date Time Country

May 18 09:30 Germany Eur 1.5bn 12M (May 2016) Bubills

May 18 10:00 Belgium Auctions OLOs

May 20 09:03 Sweden Holds bond auction

May 21 08:30 Spain Auctions Bonos

May 21 09:03 Sweden Holds bond exchange auction

May 21 09:10 France Auctions BTANs

May 21 09:30 UK Auctions 4.75% 2030 Conventional Gilt

May 21 10:10 France Auctions

May 21 15:30 Italy Announces details of CTZ/BTPei on 26 May

May 21 15:00 US Announces details of 2-year FRN on 27 May, plus 2/5/7 year

May 21 17:00 US Auctions 10-year TIPs

May 22 09:03 Sweden Holds bond exchange auction

May 22 10:00 Norway Details bond auction on 27 May

 

EUR/USD analysis forecast

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