The Euro US Dollar (EUR USD) exchange rate has been trending in a fairly narrow range this week, moving between 1.1184 and 1.1273 .
Eurozone data has mainly been overshadowed by the Deutsche Bank situation, although some recent Euro gains have been triggered by some highly positive confidence results for September.
The US Dollar has also received a boost recently from Organisation of Petroleum Exporting Countries (OPEC) news, where apparent plans to limit oil production have sent the price of the commodity and value of the US Dollar soaring.
Over the previous week, the Euro was able to steadily appreciate against the US Dollar, climbing from a starting region of 1.11 to a closing figure of 1.12 on Friday.
Euro (EUR) Confidence Data Eclipsed Ongoing Deutsche Bank Concerns
While the Euro was unable to gain much ground on the US Dollar on Thursday, other more substantial gains were recorded elsewhere due to rising confidence figures for the Eurozone triggering an increase in optimism among common currency investors.
The September confidence stats were a virtual clean sweep for the Euro, with the services, economic and industrial sentiment stats improving along with the consumer and business confidence results.
This pushed the Euro out of period of prolonged decline, which had come from the news that Deutsche Bank (DB), Germany’s largest commercial bank, was facing serious financial difficulties.
Despite rumours alleging the fact, the German government has shown no plans to bail out the bank, which has raised questions about whether allowing DB to fail will be better or worse than the deeply unpopular action of keeping it afloat with taxpayers’ money.
US Dollar Update: Oil Prices and GDP Stats Supported USD on Thursday
The US Dollar found itself in progressively higher demand over Thursday afternoon during the European trading session, on account of both domestic and global ecostats.
On the homefront, upward revisions of finalised Q2 GDP results saw the odds of a December Fed interest rate hike increase considerably, while from further afield, news that OPEC had apparently agreed to finally limit oil production was also greatly beneficial to the ‘Buck’.
EUR/USD Exchange Rate Forecast
Looking ahead, Euro/US Dollar exchange rate movement is set to occur in response to Friday’s Eurozone unemployment and inflation rate results, as well as the coming Monday’s Eurozone and US manufacturing PMIs.
Forecasts for Friday morning’s Eurozone inflation rate results for September have been positive for both the base and Core fields, while the August unemployment rate is also expected to dip slightly from 10.1% to 10%.
Looking further ahead, finalised Eurozone-wide manufacturing PMIs have been estimated to rise in September, while US manufacturing PMIs, from Markit and ISM, are respectively expected to decline and rise.