The Federal Reserve will release its interest rate decision next week. Market participants were cautious this week as the U.S. economic data was not able to clarify if the Fed starts raising its interest rate in September or not. The U.S. labour market continued to strengthen. The number of initial jobless claims in the week ending September 05 in the U.S. declined by 6,000 to 275,000 from 281,000 in the previous week, in line with expectations.
But the inflation in the U.S. remains weak. The U.S. producer price index was flat in August, beating expectations for a 0.1% decline, after a 0.2% rise in July.
On a yearly basis, the producer price index decreased 0.8% in August, beating forecasts of a 0.9% decline, after a 0.8% fall in July.
A stronger U.S. dollar and low oil prices still weigh on inflation.
The producer price index excluding food and energy climbed 0.3% in August, exceeding expectations for a 0.1% gain, after a 0.3% increase in July.
On a yearly basis, the producer price index excluding food and energy climbed 0.9% in August, beating forecasts of a 0.7% increase, after a 0.6% rise in July.
The consumer sentiment in the U.S. seems to weaken this month. The Thomson Reuters/University of Michigan preliminary consumer sentiment index slid to 85.7 in September from a final reading of 91.9 in August, missing expectations for a decrease to 91.2. It was the lowest level since September 2014.
China will release its economic data on Sunday. The weak data from China could force the Fed to delay its interest rate hike.
Greece should turn again in focus as the snap election is approaching. The election will be held on September 20. It will need time to form a government. The implementation of the bailout obligations is likely to suffer.
It is likely that the currency pair EURUSD will test the level at $1.1400, maybe even the level of $1.1500, if the Fed will not raise its interest rates.
If the Fed raises its interest rate, the currency pair EURUSD may test the level of $1.1100 or $1.1000.
Risk Warning: Trading Forex and CFDs on margin carries a high level of risk and may not be suitable for all investors. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prior to trading, you should take into consideration your level of experience and financial situation. TeleTrade strives to provide you with all the necessary information and protective measures, but, if the risks seem still unclear to you, please seek independent advice.
© 2011-2020 TeleTrade-DJ International Consulting Ltd
TeleTrade-DJ International Consulting Ltd is registered as a Cyprus Investment Firm (CIF) under registration number HE272810 and is licensed by the Cyprus Securities and Exchange Commission (CySEC) under license number 158/11.
The company operates in accordance with Markets in Financial Instruments Directive (MiFID).
The content on this website is for information purposes only. All the services and information provided have been obtained from sources deemed to be reliable. TeleTrade-DJ International Consulting Ltd ("TeleTrade") and/or any third-party information providers provide the services and information without warranty of any kind. By using this information and services you agree that under no circumstances shall TeleTrade have any liability to any person or entity for any loss or damage in whole or part caused by reliance on such information and services.
TeleTrade cooperates exclusively with regulated financial institutions for the safekeeping of clients' funds. Please see the entire list of banks and payment service providers entrusted with the handling of clients' funds.
TeleTrade-DJ International Consulting Ltd currently provides its services on a cross-border basis, within EEA states (except Belgium) under the MiFID passporting regime, and in selected 3rd countries. TeleTrade does not provide its services to residents or nationals of the USA.