Euro/USD Daily Outlook –March 29

The Euro/USD didn’t do much yesterday and remained virtually flat. There weren’t big headlines that came out yesterday. The U.S durable goods report came out and may have affect market sentiment and thus also commodities prices. The ministers of finance of EU will meet today and may decide to expand the rescue fund to nearly €1 trillion.  

Additional items of today’s agenda include U.S. unemployment claims weekly update will come out, the last estimate of U.S GDP fourth quarter of 2011.        

Here is a short outlook for the Euro /USD including the main news items and events that may affect this exchange rate for March 29th:

Forex Market February Update:

The Euro to US Dollar edged up by 0.01% on Wednesday to 1.3317; during March, the EUROS/USD decreased by 0.1%. Alternatively, the Canadian Dollar and Aussie dollar depreciated against the USD. The Yen appreciated against the US Dollar.

The chart below shows the development of the Euro to US Dollar during the month (UTD).


Chart Euro to us dollar Exchange Rates  28  March
Correlation of Euro/USD and Gold Prices – March 29th

The chart herein presents the development of the linear correlation (moving correlation) between gold price and Euro/U.S dollar (daily percent changes) during the last four months (up to March 28th).

Correlations Euro to us dollar and gold price  2011-2012 March 28

The chart shows a rise in the relation between the two. Currently the linear correlation between the two daily percent changes of these items is nearly 0.64 for March. This might suggest the influence (if at all) of the Euro/USD on the direction of the gold price has strengthened in recent weeks.

Current Forex Indexes March 29th

Euro to US Dollar is traded at 1.3332 a 0.11% increase as of 09:04*.

GBP to USD rate is at 1.5923 a 0.22% increase as of 09:04*.

(* GMT)

Forex Related News for the Day

Final U.S GDP 4Q 2011 Estimate: This will be the final estimate of U.S’s fourth quarter 2011 real GDP growth. In the recent estimate the U.S GDP in the fourth quarter rose by 3%; in the 3Q2011 the GDP growth rate was 1.8%, compared with 1.3% increase at 2Q2011. This shows a slight increase in the growth rate for the US’s GDP. The current expectations are that the growth rate in the fourth quarter will remain high. If there will be a sharp shift in this estimate it could also affect the path of the US dollar (for the previous estimate of US 4Q GDP).

U.S. Jobless Claims Weekly Update: initial claims decreased to 348,000 claims for the week ending on March 17th; the number of insured unemployment declined by 9 thousand to 3,352 thousand during the week of March 10th; the upcoming weekly update may affect the direction of the US dollar;

Bernanke Speech: The speech is part of four piece lecture series. The title of this speech is “The Federal Reserve and the Financial Crisis” Part 4″;

Euro to USD Daily Outlook

I speculate the Euro will continue its recent upward trend of the past couple of weeks. The meeting of the EU ministers of finance will convene today and may approve to enlarge the rescue package to near €1 trillion. This news may push up the Euro. The U.S jobless report and GDP final estimate for the last quarter of 2011 may affect the strength of the US dollar.

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