The single currency fluctuated the euro in a narrow range slanting back down during the Asian session against the US dollar on the threshold of economic developments and data expected on Tuesday by the economies of the euro area and the US economy, the largest economy in the world, which includes the testimony of the Federal Reserve Governor Jerome Powell with US Treasury Secretary Stephen Mnuchin Before the House Financial Services Committee in Washington.
At 05:42 am GMT, the euro against the US dollar fell 0.14% to 1.1226 levels, compared to the opening levels at 1.1242, after the pair achieved its lowest level during the trading session at 1.1225, while achieving the highest at 1.1252.
The markets are looking for the second largest economy in the euro area, France, to disclose inflation data with the release of the initial reading of the consumer price index, which may reflect the acceleration of growth to 0.4% compared to 0.1% last May, in conjunction with the release of the consumer spending index also for France, which It may reflect a 30.0% increase compared to a 20.2% decline in May.
This comes before we witness from Italy, the third largest economy in the euro area, the release of the initial reading of the consumer price index, which may show 0.1% growth against a 0.2% contraction in May, coinciding with the release of the initial annual reading of the same indicator for the economies of the region as a whole, which may reflect a 0.1% contraction against Growth of 0.1% in May, while the preliminary substantial annual reading of the index may show that growth slowed to 0.8% versus 0.9%.
On the other hand, investors are currently awaiting by the US economy the disclosure of housing market data with the release of the annual reading of the house price index, which may show a slowdown in growth to 3.8% compared to 3.9% last April, before and before the disclosure by the largest industrial country in The world reported that the Chicago PMI reading may reflect the contraction shrinking to 45.0 compared to 32.3 in May.
This comes before we also witnessed by the largest economy in the world the release of the consumer confidence index, which may appear widening to 91.6 compared to 86.6 in May, and before we witness the speech of the Federal Open Market Committee member and New York Federal Reserve Chairman John Williams about the recession The US and the Monetary Policy Response at an online seminar hosted by the International Finance Institute.
Later in the day, markets were looking forward to the talk of Federal Open Market Committee member and Federal Reserve Governor Elle Brenard about the Dodd-Frank Act at an online seminar hosted by the Brookings Institution and the University of Michigan, leading to Fed Governor Jerome Powell’s testimony with US Treasury Secretary Stephen Mnuchin via satellite in front of the House Financial Services Committee in Washington.
In the same context, Federal Open Market Committee member and Federal Reserve Bank President Neil Kachkari is also expected to participate in a virtual panel discussion on racial inequality and social justice hosted by the National Association of Business Economics, and this comes in the wake of strikes in Minneapolis and many of the United States Recently, James Floyd was killed by American police officers.
We would like to point out, because the Federal Reserve Governor Powell confirmed yesterday that the expectations regarding the American economy are "unconventionally uncertain", expressing that the adoption of more monetary stimulus may be necessary, and it is reported that Powell noted last week during his testimony before the Congress that there is a case of Uncertainty about the timing and strength of the potential economic recovery and that the current downturn may lead to widening inequality within his country if the matter is not contained.
Last week, Powell also mentioned in his semi-annual testimony about monetary policy before the Senate Banking Committee and the House of Representatives Financial Services Committee in the US Congress that "until confidence returns that the Corona pandemic is under control, a full recovery will not be possible" and that "the downward curve continues and with it continues Possibility of jobs falling under the risk of final loss and business closure. "
At the time, the Federal Reserve governor expressed before the Senate, in both the Senate and the House of Representatives, that it is unlikely that we will witness a complete recovery of the largest economy in the world before restoring economic confidence, with his statement that the epidemic has a greater impact on people with low incomes, and his discussion of the fact that the difference in the rise in unemployment is now a year. 2008, that at that time there were no jobs, while the current situation is the result of business closings and that with its return people return to their jobs.
It is noteworthy that the US Congress has allocated $ 3 trillion so far as financial stimulus that included direct financial distributions for families and plans to exempt from small business loans, while the Federal Reserve has implemented cash stimulus programs exceeding $ 1 trillion to support the credit market for families and companies, the last of which was the launch of the Federal Reserve last week for a program that provides a package Loans worth $ 600 billion for businesses that employ around 15,000 people or whose returns exceed $ 5 billion.
Technical analysis
The euro against the dollar pair returns due to the fluctuation between the support levels 1.1175 and the resistance 1.1270, to keep our neutral stance standing until the price is able to penetrate one of these levels and define its next targets more accurately, noting that the conflict between the stochastic positive and the moving average negativity 50 provides another reason for neutrality.
We remind that breaching the mentioned resistance will lead the price to resume the main bullish trend whose next target is at 1.1420, while breaking the support is a negative factor that will force the price to make an additional bearish correction targeting 1.1100 then 1.1020 before any new attempt to rise.
The expected trading range for today is between 1.1140 support and 1.1340 resistance
Expected trend for today: It depends on the levels mentioned in the report
