EURUSD is rising ahead of Fed minutes publication

21 February 2024 119
EURUSD is rising ahead of Fed minutes publication

The EURUSD currency pair is rising for the fifth day in a row and is now approaching the highest point of the week due to a slightly weaker dollar. Investors are waiting for today's publication of the US Federal Reserve's (Fed) latest meeting minutes. They may provide more information on the future course of interest rates.


According to a Reuters survey, most economists expect the Fed to cut the federal funds rate in June. However, there is a high risk of postponing monetary policy easing by the US regulator to a later date.


As noted by San Francisco Fed President Mary Daly, despite significant progress in fighting US inflation, the central bank still has a lot of work to do to ensure price stability.


The latest better-than-expected US consumer and manufacturing price data raised doubts about the probability of a rate cut in March. However, markets estimate the likelihood of monetary policy easing in June at 77%, according to the CME FedWatch tool.


Meanwhile, the fresh data from the European Central Bank (ECB) showed that wage growth in the eurozone slowed from a record 4.69% to 4.46% in the fourth quarter of last year. But it still exceeds the regulator's target level. The ECB considers this indicator to be crucial for determining the further course of monetary policy.


European officials keep closely monitoring the dynamics of wages in the region. This will determine both the timing and the scale of the ECB’s interest rate cut, the agency stressed.


EURUSD quotes moved out of the downtrend on the H4 timeframe. Bulls Power indicator (standard values) remains in the positive zone, pointing to the upward movement.


Signal:

The short-term outlook for the EURUSD pair suggests buying

The target is at the level of 1.1000.

Part of the profit should be taken near the level of 1.0890.

A Stop-loss could be set at the level of 1.0660.

 

The bullish trend is short-term, so trade volume should not exceed 2% of your balance.

This content is for informational purposes only and is not intended to be investing advice.

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