The Euro/USD continued its decline as it fell during the past three consecutive days. There are several items on today’s agenda including U.S non-manufacturing PMI and U.S. factory orders.
Here is a short outlook for the Euro /USD for March 5th:
Forex Market February Update:
The Euro to US Dollar sharply declined by 0.85% on Friday to 1.3198 - the lowest level since February 17th; during last week, the EUROS/USD decreased by 1.9%. Furthermore, the CAD and CHF also sharply depreciated against the USD.
The chart below shows the recent developments of the Euro to US Dollar during February/March (UTD).
The chart below presents the development of the linear correlation (moving correlation) between the Australian dollar and the Euro/U.S dollar (daily percent changes) during the past several months (up to March 2nd).
Based on the chart the correlation between the two exchange rates has weakened compared with its level in the past, but it is still strong and robst. Currently the linear correlation between the two daily percent changes of these currencies is nearly 0.57 for February/March. This might suggest the affect of the Euro/USD on the direction of the AUD/USD is weaker in recent weeks than it was a few months back.
Current Forex Indexes March 5th
Euro to US Dollar is traded at 1.3204 a 0.05% increase as of 10:05*.
GBP to USD rate is at 1.5819 a 0.09% decrease as of 10:05*.
Forex Related News for the Day
U.S Factory Orders: This report will present the changes in U.S. factory orders of manufactured durable goods during December. According to the recent flash report, in January new orders of manufactured durable goods declined to $206.1 billion;
U.S. Non-Manufacturing PMI: This report will show the developments in the non-manufacturing sector during February 2012. In January this index moderately increased to 56.8%;
These two reports may affect the strength of the US dollar.
Euro to USD Daily Outlook
I speculate the Euro/USD pair will continue to dwindle and perhaps even trade down a bit during the day; this scenario may be more likely if the above-mentioned reports will be positive and thus may strengthen the US dollar.
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