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EURUSD: Jerom Powell may determine the future direction for the us dollar

RSS feed for Forex Review 09.07.2019 at 07:09

Daily analytical reviews of the Forex market

Us dollar maintained the momentum for further growth after yesterday's data, which pointed to inflation expectations and credit growth in the United States.

Today, all attention will be attracted to the speech of fed Chairman Jerome Powell, which, apparently, will depend on further direction in the pair EURUSD. If Powell talks about the recent data on the U.S. labor market, it will support the dollar, as the fed Chairman may hint at a delay in lowering interest rates to obtain a clearer fundamental picture. If well fed will continue to stick to the script may change the conditions of monetary policy in the direction of weakening it, the pressure on the American dollar will come back.

Returning to the report on inflation expectations in the United States, in the past month they have grown, which leaves the possibility for the return of annual growth rates to the target level set by the Federal reserve system at the level of 2%.

According to a survey by the Federal reserve Bank of new York, inflation expectations in June reached 2.7% vs. 2.5% for the year ahead. In the fed-new York also noted that inflation expectations rose among all groups of respondents.

As I mentioned above, consumer credit in the United States in may continued its growth, which is a good signal for the economy, as it will lead to higher consumer spending.

According to the Federal reserve, unsecured consumer credit in may 2019 rose by 5.0% per annum to 17.09 billion U.S. dollars compared with the previous month. Economists had expected credit growth in may at $ 17 billion.

with respect to revolving loans, then the volume in may increased by 8.2% compared to the same period of the previous year. Non-revolving loans during the reporting period showed an annual increase of 3.9%.

on Monday also released a report on the indicator, which monitors the situation on the US labor market. Given the growth of respondents stated that difficulties finding work increased, the index fell in June this year.

According to the Conference Board index of employment trends in June was 109,51 points against the may value in 111,22 points. Despite this, it is expected that long term growth rate of the index remained at a high level. Recall that in June this year, the number of jobs outside of agriculture grew by 224 000 and the unemployment rate was 3.7%.

as for the technical picture, the market gradually returning the sellers of risky assets. At the moment the major support lies in the area of 1.1205, a breakthrough which will provide further bearish trend of new sellers, the purpose of which will be lows in the region 1.1160 and 1.1110. If the bulls will try to rectify the situation, the upward correction will be limited to major resistance around 1.1260, where and the upper limit of the downward channel.

the Material has been provided by InstaForex company -