EURUSD is lower on Monday with the release of US inflation and Federal Reserve meeting minutes due on Wednesday.
EUR/USD was heading for the recent resistance at 1.1030 but has since stalled ahead of 1.10. The pair could move lower into the range with support near 1.0550.
The US stock markets will be in focus this week as the large banks release their Q1 earnings. That could provide some surprises after the recent banking turmoil, which saw significant deposit moves to large banks. The International Monetary Fund will also release an updated forecast for the global economy.
Investors will be watching the latest release of US inflation with figures for the March period. Economists expect a rise of 0.4% on a month-to-month basis, resulting in an annual increase of 5.6%. Federal Reserve minutes will also be released for the March meeting, and investors may better understand the monetary policy plans.
EURUSD Forecast
The Federal Reserve had been on an aggressive rate hike path. Still, the collapse of Silicon Valley Bank led to a pause in the bank’s plans as financial firms felt the strain.
However, Friday’s NFP jobs number was robust for the US economy, leading to a stock sell-off despite weaker areas, such as manufacturing.
There are also signs of an economic slowdown for the euro, with mixed financial data and fears of a recession. European equities recorded their worst March since 2020 as recent turmoil in banks reversed an excellent start to 2023.
Traders can watch Wednesday’s US inflation data and the market reaction to the Fed minutes. The central bank has said it is still committed to higher rates, and the data could add some bullish strength to the US dollar.
