The week started with heavy fluctuations and surprises for the EUR/USD yet the common currency maintained its strength despite the dollar’s rebound.
The dollar on Monday regained momentary strength after US President Obama announced the death of al-Qaeda leader Osama Bin Laden. Nevertheless, the gains did not last against the euro as the currency returned to trade higher ahead of the ECB meeting this week.
We had good figures from the euro area which supported the gains with the upside revision to April’s PMI Manufacturing as growth in the manufacturing sector accelerated in Germany and supported the aggregate index for the area.
Investors remain jittery ahead of key data this week from the euro area and the US as well and especially with interest rate bets predominant for the pair’s movement and favoring the euro for more gains.
The data for Tuesday remain light yet more to add to the hawkishness on the euro. Further inflationary insight into the area will be critical ahead of Trichet’s press conference on Thursday following the rate decision which is expected steady at 1.25%.
Producer Price Index is due at 09:00 GMT and expected with 0.7% rise in March from 0.8% to an annual 6.6% inline with the previous.
As for the US, the Factory Orders for March and to slightly affect the market. The data is due at 14:00 GMT and expected strong with 1.9% rebound from 0.1% drop in February supporting the risk appetite and probably continued euro gains.
Written by ForexMansion.com