Euro Remains at a Steady Price Despite Prevailing Events

The Euro continues to maintain a steady performance on the exchange market as it closed yesterday at a flat price. Presently, the market trading price of the EUR/USD is at 1.1873 despite the events that played out last week and their expected impact on the market. However, yesterday’s trading session saw a mix of eurozone numbers which was not entirely comforting. For the services sector, the Eurozone continues to reflect a powerful expansion with a 60.8 index in Germany and 59.0 in the eurozone proper. This implies that services PMIs in Germany for August experienced a slight drop. While these data may look comforting, in reality, they are weaker than the results in July. 

However, investors should not be worried yet about the weakness as it doesn’t pose too much of a threat to the euro. Euro’s flat price is considerably steady despite the volatility of the market. The service sector is not the only area affected as the fall of retail sales is even more. News from the eurozone retail sales sector is more worrisome as it experienced a harsh decline of 2.3%, which for investors is a negative turn. This decrease marks the third in the space of three months in which retail sales have been experiencing reductions. 

Even with the drops in the eurozone retail sales and services, the euro remains unmoved. However, this is likely to change as it is expected to show some volatility. Its volatility would be in light of the release of nonfarm payrolls by the US that happened yesterday. Amazingly the US dollar put on a struggling show this week with the market showing signs of an impending dollar sell-off today. The nonfarm payrolls results are also set to impact the US dollar as the outcome would either lead to a massive sell-out or a more modest one. Nevertheless, there are expectations for the EUR/USD to push into the 1.9 area in the coming days. 

Events of The Week And Their Market Impacts

The EUR/USD market is one market that the Jackson Hole Summit spiked its volatility this week with the outcomes still fresh in the minds of investors. The Federal Reserve through the event made their stance on their expectations for the market performance clear. For the Feds, stronger job numbers are expected to be seen before tapering. This expectation has resulted in a slight irregularity in the price action of both the EUR and USD. With the decision of the Federal Reserve, yesterday’s NFP results are set to also impact the market and tapering too. 

If the Federal Reserve is convinced by the NFP results, then investors might just expect a coming tapering early. The earliest time which should be expected is in October and that is if everything goes as planned. However, if it fails to make a good impression, then tapering might just be delayed till next year, probably in January. 

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