Daily exchange strategy: the gap between data and the euro area | article

FOMC meeting (Wednesday) with rate cut of just 25 basis points (down 29bp), strong US data (ISM rebound Thursday and strong market report) US labor expected Friday – with a rise in non-farm payroll and a spike in wage growth – is expected to maintain the dollar's support in place this week against weak yields such as the euro and the yen. Unclear data in the euro area or a more accommodative central bank bias on the part of the central bank could help keep the respective currencies lower against the US dollar.

Nevertheless, a relaxation of monetary policy could support the exchange rate of emerging countries against the US dollar (and the euro in particular) later in the week. However, unless the Fed announces a more pronounced easing cycle (already four cuts planned by the end of 2020), emerging market gains may not be maintained, particularly if trade uncertainty persists (trade talks resume this week) and the euro zone shows a new trend. signs of slowing down.