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Euro US Dollar (EUR/USD) Exchange Rate Falls as German Business Climate Deteriorates

US Dollar Currency Forecast

Euro US Dollar (EUR/USD) Exchange Rate Slips on Disappointing German IFO

The Euro US Dollar (EUR/USD) exchange rate edged down and the pairing is currently trading at an inter-bank rate of $1.1207.

This morning data revealed that in April German IFO business climate deteriorated unexpectedly.

Business climate fell from 99.6 to 99.2 despite forecasts suggesting this figure would rise.

This likely dampened sentiment in the single currency.

Commenting on the weakness in the single currency, Kit Juckes, Societe Generale Currencies Analyst said:

‘The Euro is teetering as negative sentiment persists after last week’s disappointing PMI data and only the size of short positions and the extent of negativity are keeping it above the year’s lows.’

US Dollar (USD) Edges Up as US Housing Market Shows Signs of Recovery

Meanwhile the US Dollar was propped up by Tuesday’s strong US housing data, which could suggest the American economy is outgrowing its rivals.

Data showed that sales of new single-family homes in the US rose by 4.5% in March, nearly a one-and-a-half year high.

This was the third consecutive monthly increase, suggesting that the housing market was beginning to recover.

Commenting on this, Danielle Hale, Chief Economist at Realtor.com said:

‘In this housing market, affordability for buyers is key.

‘This trend supports the fact that lower mortgage rates have started to entice buyers this spring and foreshadows a potential strengthening of existing home sales in the months to come.’

US-China Face-to-Face Trade Talks Set to Continue Next Week

In a statement from the White House, US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are due to travel to Beijing for further trade talks on 30 April.

The White House said:

‘The subjects of next week’s discussions will cover trade issues including intellectual property, forced technology transfer, non-tariff barriers, agriculture, services, purchases, and enforcement.’

Commenting on the progress so far, Director of the White House National Economic Council, Larry Kudlow said:

‘We’re not there yet, but we’ve made a heck of a lot of progress.

‘We’ve come further and deeper, broader, larger-scale than anything in the history of US-China trade.’

This optimism likely sparked an increase in risk appetite, however the ‘Greenback’ edged up against the Euro.

Euro US Dollar Outlook: Will the EUR/USD Exchange Rate Fall on Disappointing German Consumer Confidence?

Looking ahead to the start of Thursday’s session, the Euro (EUR) could slide against the US Dollar (USD) following the release of Germany’s GfK consumer confidence data.

If consumer confidence falls once again in May, the single currency could fall.

Later in the session the US non-defense capital goods orders excluding aircraft is due to be released.

If orders increase in March, the ‘Greenback’ could receive an upswing in support, and the Euro US Dollar (EUR/USD) exchange rate could fall.