EUR / USD
Last Friday, the events developed according to expectations. In the euro area, macroeconomic data came out weak but gained strength in the United States. Generally, the dollar strengthened its market positions.
France's trade balance in March deteriorated from -5.0 billion euros to -5.3 billion, the budget deficit rose from -28.5 billion euros to -33.1 billion. The final estimate for April business activity index in the services sector (Services PMI) in the eurozone was lowered from 55.0 to 54.7. Retail sales in the euro area in March grew by 0.1% only against expectations of 0.5%, although the February figure was revised upward from 0.1% to 0.3%. The Spanish PMI Services for April deteriorated from 56.2 to 55.6.
The Italian Parliament has entered a political impasse. The Democratic Party refused to form a coalition with Berlusconi-Salvini and the "5-star" party. As a result, President Sergio Mattarella is forced to schedule re-elections tentatively in October, and before that, a technical government will be created. Prior to the opening of the American session, the single European currency was declining.
US labor data caused increased activity in the market. The growth of non-farm employment - Non-Farm Employment Change - amounted to 164 thousand in April versus expectation of 190 thousand, with the revision of the March index of +32 thousand. Also, the unemployment rate dropped from 4.1% to 3.9%, which was a record since January 1970. Skeptical statements of business media about the sharp unemployment reduction, due to the decline in the proportion of the economically active population from 62.9% to 62.8%, are taken with even greater skepticism, as empirically reducing the share of this indicator by a step of 0.1% affects the overall unemployment by 0.05%. The deterrent is the increasing aging population in the US. The structure of non-pharmaceuticals looks qualitative, as the number of jobs in the manufacturing industry has increased by 24 thousand with the expectation of 20 thousand. It also draws attention to the growth of April hourly wages by 0.1% versus the forecast of 0.2%, but this only keeps the salary growth at an annual rate of 2.6%. In a similar vein, William Dudley and John Williams will speak, as they both described the employment growth as good. Also, they both have a positive estimate for inflation growth and Williams even suggested that its retention is above the target level, which indirectly hints at the firm intention of the Fed to increase the key rate three times.
Today, an increase in German industrial orders will be released in March with 0.5% forecast versus 0.3% in February. The investor confidence index in the eurozone Sentix for the current month is projected to increase to 21.2 from 19.6. At 8:00 PM London time, there will be a volume of consumer loans for March, showing a forecast of $ 16.2 billion compared to $ 10.6 billion in the previous month. Also, today is a traditionally low-lateness day and the UK is in a holiday, therefore, correction is possible for European currencies.
For the euro, the expected correction may not reach the resistance zone 1.2040 / 60.
