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COZfx: European Commission upgraded Euro-zone’s growth forec

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COZfx: European Commission upgraded Euro-zone’s growth forec

Postby dwang » Thu Feb 27, 2014 2:17 am

COZforex: For the past trading session, the EUR rise 0.08% against the USD and closed at 1.3746, after data showed that, on a non-seasonally adjusted basis, Germany’s GDP rise 1.3% in the fourth quarter, the fastest pace since March 2012 and compared to a 1.1% rise registered in the preceding quarter. In addition, the Q4 exports in the nation advanced to the highest-level in three-years, suggesting a sustainable growth in Germany as compared to other nations in the Euro-zone.

Positive sentiment for the single currency was also fuelled after the European Commission, in its winter forecast, upgraded its 2014-growth-outlook on the Euro-zone economy, stating that the recovery in the region was “gaining ground”, although it continued to remain modest. However, at the same time the Commission slashed its inflation forecast for 2014 and 2015, adding that unemployment rate in the region would remain high in the near future.

Elsewhere in the Euro-zone, a report showed that an index measuring the consumer climate in France stood pat at a reading of 94.0 in February, defying analysts’ expectation for a rise to a level of 95.0. Separately, data from Italy revealed that the nation’s trade balance with non-EU countries swung to a deficit of €0.89 billion in January, following a surplus of €3.41 billion in December while another report confirmed that retail sales in the nation unexpectedly dropped 0.3% in December.

Meanwhile, in the US, the Fed Governor, Daniel Tarullo stated that the financial stability of the nation is a growing concern for the Fed and the central bank should consider certain alterations in its monetary policy tools to address such concerns.

On the economic front, consumer confidence in the US dropped to a reading of 78.1 in February, contradicting analysts’ call for a rise to a figure of 80.0, from previous month’s level of 79.4. Separately, the US Federal Housing Finance Agency reported that its House Price Index grew 0.8% in December, compared to a revised fall of 0.1% recorded in the previous month.

In technical analysis, COZFX strategist Nigel Boynton said, EUR/USD is predicted to find support at 1.3714 and a drop through could take it to the next support line of 1.3688. Meanwhile, the pair is predicted to find its first resistance at 1.3767, and a rise through could take it to the next resistance line of 1.3794.

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