Published on 10.10.2022 09:07

The Euro is taking a breather in today’s Asian trading session against the greenback after falling heavily for 3 consecutive days as market participants sit on the sidelines due to the public holiday in the US which means the EUR/USD currency pair will prob ably remain rangebound.

On Friday the European currency suffered another major setback after the US jobs report for September showed that the all-important Nonfarm Payrolls rose to 265K against analysts’ expectations for a figure of 250K. There was also further strength in the jobs market with the release of the Unemployment Rate which fell to 3.5% compared to forecasts for a figure of 3.7%.

Following the news, the market has now priced in an almost 80 percent chance that the US Federal reserve will raise interest rates by 75 basis points in November which will once again widen the difference in yield differentials between the Euro and US dollar.

The upcoming week will be crucial for the EUR/USD currency pair and the main topic will be inflation and especially news from the US. The Federal Reserve will release the Minutes of its latest meeting on Wednesday, while on Thursday the country will publish the September Consumer Price Index.

Inflation figures are expected to hit the market at 8.1% which is slightly better than the previous months numbers of 8.3%. The core reading is predicted to come in at at 6.5%.

From the Euro zone we will also see inflation figures from with the release of the Harmonized Consumer Price Index which is expected to come in at 10.9% and force the European Central Bank into another rate hike.

Due to the public holiday in the US and the lack of economic news, the main driver of the EUR/USD currency pair today will be the potential reprisals from Russia after the bridge that crosses over to occupied Crimea was attacked leaving parts of it destroyed.

Russian President will chair a special meeting today to access the situation and many predict there may be a sharp escalation in the conflict as Russia tries to seek revenge


FAQ