Alfa Forex: EUR / USD – ECB is trying to slow down the growth of the euro

25 May 2021

Quotes of the euro against the dollar are trying to develop a movement above the resistance of 1.2200. In May, the purchasing managers of the Eurozone countries were more active than expected: the PMI in the manufacturing and services sectors amounted to 62.8 points and 55.1 points against the predicted 62.5 and 52.3 points. respectively. It should be noted that in terms of inflation, the European Union is still significantly inferior to the first economy in the world: in April, European prices added 1.6%, while in the United States, the growth was as much as 4.2%. Commenting on the economic situation at a press conference last Friday, Christine Lagarde (head of the ECB) noted that at the current stage of economic recovery, nothing gives a reason to discuss the reduction of the stimulus program. The statement significantly weakened the position of the euro, knocking down the bullish sentiment of the EUR / USD pair for the next session.

The EUR / USD pair is trying to continue to rise above 1.2200 in the direction of 1.2350. The support for the market is the levels 1.2150 and 1.2000.

RUBLE – the national currency is in moderate demand.

The Russian ruble is in moderate demand due to the weakening of the dollar in the global foreign exchange market (the dollar index reached 89.65 points, this is the minimum since January of this year), thanks to expensive oil (a barrel of Brent is trading above $ 67), as well as on expectations of an increase in the key rate by the Bank of Russia in June. The April inflation of 5.5% exceeds the current refinancing rate, which gives investors the opportunity to build up Carry Trade’s positions in the context of subsiding geopolitical tensions. In general, the players are leveling their trading positions in anticipation of news about the upcoming meeting of the US and Russian presidents.

The USD / RUB pair should be gradually declining towards the level of 72.70. Resistance for the market is the area of ​​75 rubles – 75.50 rubles per dollar.

The EUR / RUB pair is trading near the psychological 90 rubles, remaining within the trading corridor of 88.60-92 rubles per euro.

This information is not investment advice.

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