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The Euro foreign exchange rate continues to consolidate. It fell below the psychological level of 1.19 and is on consolidation mode at 1.18 levels.

Fed Chairman Jerome Powell is due to speak at Jackson Hole on Thursday. Investors expect him to bring in a monetary policy easing to give a further boost to the economy that will help them make money in the forex market.

The European Central Bank has emphasized that the 1.350 trillion package recently announced was the ceiling rather than the target. The Pandemic Emergency Purchase Program (PEPP) was launched in March to address the coronavirus pandemic and is expected to bring results soon, to pull up the region.

If the euro foreign exchange rate rises above $1.20, the Eurozone may see a downturn as it is export-sensitive, and the demand for goods and services in the Eurozone may be affected.

EURO Foreign Exchange Rate Awaits Fed’s Monetary Policy Announcement

The Currency pair is weakening with the greenback growing strong.

EURO currency exchange rate against the US Dollar continues its winning streak but remains range-bound. The range for this month continues to lie between 1.696 and 1.1966.

The Eurozone was in a positive trend as it showed signs of handling the corona pandemic well. But, of late, cases have been on the rise in Europe, while it is reducing in the US.

The EUR/USD currency pair is expected to remain within this range for the month of August, as there is not much news to drive the currency pair on either side. The Euro currency exchange rate to Dollar continues to receive support at the 1.7500 levels in August.

In Germany, GDP growth has declined by 9.7%, well below the estimated contraction of 10.1%.

Euro Foreign Exchange Rate in Consolidation
Euro Foreign Exchange Rate is Range Bound

USD Remains Soft

The S&P 500 closed at a record high again on Monday.

The US Dollar Index (DXY), which saw a 92.30 low in August, has now bounced to above the 93.00 marks. On Wednesday, it was seen trading at 93.24 at 1.16 pm GMT.

US Health Official Anthony Fauci has challenged the push to acquire a virus vaccine by the US President Donald Trump.

Meanwhile, a constructive conversation has taken place between US Trade Robert Lighthizer and Vice Premier of China Liu He as negotiations continue on a positive tone.

Fed Chairman Powell is expected to bring in a soft policy stance at his speech at Jackson Hole on Thursday. New measures are expected from the Fed chairman to revive the US economy. The euro currency exchange rate awaits the US monetary policy announcements to move further.

US Durable Goods Orders has expanded by 11.2%, which is much above the expected 4.3% on a month-on-month basis. New orders, excluding transportation, have increased 2.4%, says the US Census Bureau on Wednesday.

Sterling Strengthens Against Euro and Dollar

The EURO currency exchange rate against the British Pound (EUR/GBP) continues its two-day losing streak, falling to weekly lows to 0.8970 regions.

Despite Brexit talks not progressing on expected terms, the British Pound continues to gain strength. The psychological mark is at 0.9000, and the EUR/GBP pair has gone well below this mark on Wednesday. The level to watch out for is at 0.8942, which is the low seen on 21 Aug.

French consumer spending, which was at 9.0% in July, is expected to reduce to 1.2% in August. The Prelim GDP for this quarter is expected to remain unchanged, as the previous quarter at -13.8%.

French Prime Minister Jean Castex has dropped hints about a 100 billion-euro recovery package to be rolled out soon, which may revive the economy.

The British Pound (GBP) remains positive of late. The GBP foreign exchange rate dropped last week after the 7th round of negotiations did not show a positive result. But showing resilience to the Brexit risks, the Sterling continues its upward trajectory. It has improved against the Euro and the Dollar. The Euro currency exchange rate has been underperforming against the British Pound.

Euro Foreign Exchange Rate at Weeks Lows
Euro Foreign Exchange Rate at Weeks Lows

EUR/JPY Remains Range Bound

EURO currency exchange rate against the Japanese Yen continues to fluctuate within a small range between 126.5 and 124 in August. Further, it finds strong support at 124.70 levels.

Meanwhile, the US Dollar Index remains strong against the Japanese Yen. The currency pair has been unable to move beyond ÂĄ107.00 for the past four weeks. The 200 EMA is placed at ÂĄ107.50 levels.

In New Zealand, retail sales for the June quarter has declined by a record 15%. Retail activity has been severely affected by the COVID-19 restriction in New Zealand say, experts. Non-essential businesses had remained closed for almost half of the quarter for the pandemic, causing the decline. Though experts had expected only a 12% decline, actual data shows a steeper contraction.

The Chinese Yuan rose to seven months high at $6.8909 after the Phase 1 trade deal was confirmed. The standoff between the two largest world economies has been of concern to forex trading investors. China’s Commerce Ministry has confirmed that a constructive dialogue is going on between the two countries.

The Australian Dollar remains unchanged at $0.7198 today. Victoria is facing a rising number of coronavirus cases, and this is hindering the growth of the country.

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