Yesterday (25/3), EUR/USD rose 0.48%, from $1.0919 to $1.0963 on disappointing data about the US durable goods orders.
Specifically, the number of orders fell 1.4%, less than forecasted of increasing by 0.3%.
Currently, the pair maintains upward momentum and is trading at $1.0098 (5:00 p.m. GMT + 7) up 0.34%.
Data reported today showed M3 money supply (including deposits, institutional money market funds, short-term repurchase agreements and other larger liquid assets) in Europe rose by 11 billion euros, or 4% in February, higher than the previous month (3.7%). M3 money supply showed strong consumer spending and recovering manufacturing.
In Germany, the biggest economiy of EU, the business climate index (Ifo Business Climate German) rose to 107.9 points, higher than forecast (107.4 points) and last month (106.8 points). This shows that economy is doing extremely well. This also predicts a positive outlook for spending, hiring and investment in the future. Consumer confidence index (GfK German Consumer Climate) increased from 9.8 to 10.0.
Assessing the impact of the ECB’s QE package launched earlier in March, council member Erkki Liikanen said ECB’s QE package is supporting economic growth in Eurozone strongly and stably. Within 2 weeks, the ECB has injected 26.3 billion euros into the market via bond purchases.
All these indicators show that economic activity in Europe, from consumption and manufacturing to investment, are rising sharply, the euro will get backed up.
Meanwhile, the US dollar weakened against other currencies.
Tonight U.S. data on unemployment claims and purchasing managers index PMI will be published. In particular, the unemployment claims is forecasted to add up by 291,000, the PMI index wil rise from 57.1 to 57.2.
Forecasting the euro will continue to be supported by upbeat economic outlook in Europe.
EUR/USD likely to hit resistance at $1.1094 set on January 16th and then go down.