On Tuesday, the EURUSD exchange rate will have data from the German and US economies.
EURUSD – Daily Chart
The price of EURUSD has bounced after two ready days following the Federal Reserve. The pair could test the 1.0720 support level again.
The German economy will release consumer confidence data at 3 p.m. HKT, which could drive the exchange rate. The German economy still has some weakness, with confidence among consumers at negative levels. However, an uptick is expected to -27.9 from -29.
Further data is expected from Germany, with unemployment levels released on Thursday. A similar reading of 10k additional unemployed persons is expected.
According to a survey, eurozone business activity was close to growth last week, outperforming expectations. However, the recovery was uneven, with a strong bounce in services offsetting a more severe downturn in manufacturing. There was a similar divide between the two largest economies, Germany and France.
HCOB’s preliminary composite Purchasing Managers’ Index (PMI) from S&P Global rose to 49.9 in March from February’s 49.2, ahead of expectations in a Reuters poll for 49.7. It was close to the key 50 level after a tenth month of contraction.
“Muddling through remains the name of the game for the eurozone economy in Q1, but green shoots are emerging,” said an analyst at ING.
Early data showed that Germany’s economic downturn eased off in March as business activity in the service sector came close to stabilising. However, in France, the downturn was worse as demand for French goods and services slowed and employment fell.
The US economy will release numbers later in the evening, including consumer sentiment data and durable goods numbers.
The dollar still has an edge over the euro due to the strong US economy.
