- The US dollar maintains small gains after the American purchasing managers are disappointing.
- The American economy no longer outperforms or exceeds the euro area.
- The US dollar index (DXY) dates back to the mid -106.00 area.
The US dollar index (DXY), which tracks the performance of the US dollar (USD) for six main currencies, is trading around 106.60 at the time of this report for February. The main element that has emerged is the services sector that fell in a decrease of 49.7, a loss of 53.0 and under the reading of January 52.9. The rise in the manufacturing sector has helped give some weight to some extent to some extent.
With all US data out of this week, all eyes will turn to Sunday when the German elections are held.
Daily market engine: inflation expectations
- In the early European trading session, the data of the initial purchasing managers (PMI) was released for February in many European countries. What has emerged:
- The French HCob service managers index fell to 44.5, a loss of 48.9 estimate and the previous 48.2 contract.
- The European HCob service managers index decreased to 50.7, missing the estimated 51.5 and under the previous 51.3 reading.
- HCOB PASIS Geers victory despite the service component that reached 52.2, a loss of 52.5 and under the reading of January 52.5.
- The data of the initial global purchasing managers of the S&P for February is:
- The manufacturing sector came in 51.6, overlooking the consensus 51.5 and shortening January 51.2.
- The services sector decreased in a decrease by 49.7, a large Miss estimate 53.0, and below January 52.9.
- The University of Michigan also had some surprises:
- The consumer morale has decreased to 64.7, lost 67.8 and previous reading.
- Consumer inflation forecast index jumped for 5 years to 3.5 %, higher than 3.3 % estimate and previous reading.
- The stocks are drowned with a decrease in all indicators in the United States by 0.50 %.
- The CME Fedwatch is a 47.5 % chance that interest rates remain unchanged at the current levels in June.
- The return in the United States is trading for a period of 10 years about 4.45 %, and slides sliding beyond the highest level on Wednesday of 4.574 %.
Technical analysis of the US dollar index: fixed at the present time
The US dollar index (DXY) is able to restore a little space after performing another exposure this week. EURO (EUR), with a partial recovery in the DXY index on Friday after some disappointing PMI versions, especially from France. If the initial PMI international data for the S&P for the month of February, scheduled for this day, shows some flexibility for the country’s activity, DXY can be quickly supported at 107.00.
On the upper side, the previous support in 107.35 is now turning into fixed resistance. Moreover, SMA should be restored for 55 days at 107.96 before recovering 108.00.
On the negative side, it was 106.60 (100 days SMA) and 106.52 (April 16, 2024, high) as an alert for buyers to enter and pay DXY backup. Moreover, 105.89 (resistance in June 2024) still maintains the next company support. The RSI Momentum Momentum (RSI) in the Daily Chart still touched the sale barrier. Therefore, SMA can be for 200 days in 104.98 possible result if a fixed catalyst appears.
US dollar index: daily chart
German economy questions and answers
The German economy has a major impact on the euro because of its position as the largest economy within the euro area. The economic performance of Germany, its gross domestic product, its employment, and inflation, can significantly affect the stability and comprehensive confidence in the euro. With the strengthening of the German economy, it can enhance the value of the euro, while the opposite is true if it weakens. In general, the German economy plays an important role in shaping the strength of the euro and its perception in global markets.
Germany is the largest economy in the eurozone and therefore an influential actor in the region. During the sovereign debt crisis in the euro area in 2009-12, Germany was pivotal in establishing various stability funds to save the debtor countries. It took a leadership role in implementing the “financial compact” after the crisis – a group of the most striking rules for the Department of Financial Affairs of Member States and punishing “debt sinners.” Germany led the culture of “financial stability”, and the German economic model has been widely used as a plan for economic growth by its fellow members of the euro zone.
The factors are the bonds issued by the German government. Like all bonds that pay regular payment holders, or voucher, followed by the full value of the loan, or manager, when entitled. Since Germany has the largest economy in the euro area, factors are used as a criterion for other European government bonds. Long -term factors are seen as a strong and risk -free investment as they are supported by the full and credit belief of the German nation. For this reason, investors treat them as a safe veil by investors-and they acquire value in times of crisis, while declining during periods of prosperity.
German revenues measure the annual return that the investor can expect from the German government bond contract, or firmness. Like other bonds, the benefit of payment holders at regular intervals, called “voucher”, followed by the full value of the bond when entitlement. While the voucher is fixed, the return varies taking into account the changes in the price of the bond, and therefore is a more accurate reflection of the return. The decrease in the price of the bond raises the voucher as a percentage of the loan, which led to a rise in the return and vice versa. This explains why Bond yield is inversely moved to prices.
Bundan Bank is the Central Bank of Germany. It plays a major role in implementing monetary policy within Germany, and central banks in the region on a larger scale. Its goal is to stabilize prices, or keep inflation low and predictable. It is responsible for ensuring the smooth operation of the payment systems in Germany and participating in overseeing financial institutions. Bundesbank has a conservative reputation, which gives the priority to fighting inflation on economic growth. It was influential in the preparation and policy of the European Central Bank (ECB).
