On Wednesday , March 19 , the euro is still in the “outset ” . At 8:30 MSK its exchange rate was U.S. $ 1.3920 Currency players do not take active actions in anticipation of the announcement of the Fed‘s decision on March 19 . On the eve of the U.S. dollar went on the offensive on all fronts , and after the publication of the report of the weak ZEW euro broke below support 1.3904 dollars , asks further to 1.3888 dollars , the analyst said the company “Alpari” Vladislav Antonov .
In particular, the ZEW economic expectations index in Germany in March was 46.6 points versus 55.7 points in February and forecast of 53 points . The current conditions index reached 51.3 points against the February 50 points and predictive value of 52 points. ZEW index of economic sentiment in the euro zone , meanwhile, fell to 61.5 points compared with 68.5 in the previous month and the forecast of 67.3 points.
Began to buy up the single currency only at the level of $ 1.3889 against the backdrop of the release of data that the euro zone trade balance in January was positive and amounted to 0.9 billion euros against a deficit of 5.4 billion euros a month earlier. It is also possible that the currency rebound Strictly Light could be associated with the message that the German Constitutional Court decided under the European Stability Mechanism (ESM) constitution.
The fundamental backdrop remains positive on the Eurocurrency . Recent data on inflation in the euro area were lower than expected, which weakens the already low inflation expectations and structurally support the euro. ” An additional factor that , in essence, is a stimulus of high volatility , is the Ukrainian crisis ,” – adds analyst FC “AForex” Narek Avakian .
On Wednesday, the U.S. Federal Reserve will announce its decision on interest rates and the amount of incentive program QE3. It is expected that the latter will be reduced by 10 billion dollars – up to $ 55 billion per month. Market the event as a whole is taken into account , but by Thursday it will still support the U.S. currency and put pressure on the euro and the pound , said Antonov .
The technical picture for the euro / dollar remains neutral . Quote moves within short side corridor 1,3850-1,3950 usd . / Euro , which is confirmed and indicators. However, the main signals for the euro is still positive , so N.Avakyan expects to strengthen it in the coming days .