The Euro has pulled back in today’s trading session against its US counterpart after a round of profit taking and caution over the release of business figures from Germany yesterday when the German IFO Business Climate index came in below analysts’ expectations.
The greenback is also finding the status of a safe haven currency as covid cases in the US continue to climb, which has forced some areas in the US to make it mandatory for public workers to be vaccinated.
The major news to hit the market this week is the release of the US Federal Reserve's latest interest rate decision followed by a monetary press conference. The central bank is set to leave interest rates on hold and the big question is will there be any mention of a reduction in their bond buying program which has been supporting the US economy for some time now.
This release will be key to the Euro/USD currency pair movements this week and analysts are currently bitterly divided on how Bullish/Bearish the Fed will be.
The release later today of the US Durable Goods Orders for June, which are expected to come in above expectations may see the Euro come under pressure before tomorrow’s big news
The Euro tried to make a break yesterday of the $1.1811 resistance level but was firmly rejected and once again in today’s trading session it has made the same move but with the same result.
If the currency fails to break this resistance level before tomorrows Fed interest rate decision, this will be a bearish sign as it will show market participants are expecting a more stronger stance from the US central bank regarding their monetary policy moving forward as the year unfolds.