Skip to content EURUSD Fundamental Analysis – 22-October-2024
This week, the Euro continued its downward trajectory, starting at $1.085. This marks the fourth week in a row where the Euro has lost value, staying near its lowest point in over two months.
The focus now shifts to the European Central Bank (ECB), as traders expect further actions to relax monetary policies. There is a strong anticipation that the ECB might lower the deposit facility rate by another 25 basis points in December.
However, a more aggressive cut of 50 basis points is increasingly being considered, with probabilities now around 30%. The EUR/USD 4-hour chart below demonstrates the price, support, and resistance levels.
ECB’s Rate Adjustments and Economic Outlook
Last week, the ECB cut interest rates for the third time this year. This decision aimed to better manage inflation levels while acknowledging a deteriorating economic outlook for the eurozone.
ECB President Christine Lagarde’s remarks were taken as a negative signal about the region’s economic health. Investors and analysts are now keenly waiting for the preliminary Purchasing Managers’ Index (PMI) reports for the Eurozone, which will give the first insights into October’s economic activities.
Upcoming Economic Indicators
The upcoming PMI data is crucial as it will reveal the Eurozone’s initial economic performance in October. This information will help investors better understand the current financial trends and potentially adjust their strategies in response to the ECB’s monetary policies.
Such data is pivotal, especially when the economic outlook weakens, as it influences market sentiment and future monetary policy decisions.
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