[EUR] Exchange Rate War? 2019 0729

EUR/USD four-hour chart, source:FXDD.com

cf. [EUR] Draghi Leads Euro Up 2019 0726

The main event in the week is FOMC meeting, and FOMC determines benchmark interest rate on Wednesday.

Market participants just look at the market and wait FOMC's statement. FOMC is expected to cut its benchmark interest rate 25bp, or 0.25 percent.

It is the material for weak dollar. FOMC's possible intrest-rate cut lowers the price of greenback. Then the chart of currency pair, eur/usd will rise.

And Europe Central Bank, ECB froze its benchmark interest rate, Main Refinancing Rate to zero percent on last Thursday, which was in line with market expectations. In the press release, ECB spoke the benchmark interest rate would be frozen till next early year or may be cut.

The market participants got the hint of interest rate cut in next September, and this event lowered the price of euro. The one of the major currency pair, EUR/USD which shows euro's value dropped to 1.1100, lowest record in recent two month.

Two economy units, euro zone and the United States cut their benchmark-interest rate to avoid the recession respectively, and it put the trend of eur/usd in mixed state. It is worried the exchange rate war between two units after U.S.-Sino trade conflict.

If you don't have any position of long or short, it is recommended just to watch the market till benchmark-interest rate is released. The mail trend of currency pair may be confirmed after FOMC meeting on July 31.




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