The EUR / USD pair on Thursday demonstrates a moderate growth of 0.1%. Further upward movement of the currency pair today is limited by mixed investor sentiment on stock markets. The dollar can take advantage of this situation and go into correction after falling for 4 consecutive days. But in the long term, the American currency will remain under strong pressure.
Weaker-than-expected inflation data and statements by the head of the Federal Reserve about a long period of low rates will limit the opportunities for the US currency to strengthen. Speaking at an online conference on Wednesday, Jerome Powell noted that the US unemployment rate remains high and inflation is well below target. At the same time, Powell once again reminded of a new approach to inflation targeting, noting that the Fed allows for growth above 2% for some time before raising rates. Obviously, the US dollar cannot strengthen in the long term when the Fed implements a soft monetary policy.
Later today, the weekly data on the initial claims for unemployment benefits in the United States will be published. The indicator is predicted at the level of 757 thousand, against 779 thousand a week earlier. Also today is expected to publish the Fed's monetary policy report.
In Europe today, the focus will be on the economic outlook of the European Commission.
On the chart, the currency pair has yet to cope with the resistance at 1.2135. We are waiting for the formation of a rollback movement in the direction of the level of 1.2090.
The main scenario is a rollback to 1.2090 and an increase in the direction of 1.2175.
Alternative scenario - growth to 1.2175 from current levels.
The current fundamental background is neutral. We consider longs on a pullback to the level of 1.2090.
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