The EUR/USD pair declined sharply yesterday, affected by the downbeat French bond auction and the flow of weak fundamentals from Europe, where rising yields on French bonds in addition to the weak demand spread fears in the market that France will soon loose its top credit rating of triple A’s.
Moreover, data released yesterday showed that the German retail sales index dropped in the month of November beyond expectations by 0.9%, which also added more downside pressures on the pair to trade lower.
Today, the EUR/USD pair is expected to be very volatile and to fluctuate heavily due to the heavy load of fundamentals awaited fromEuropeand the world’s largest economy. However, all eyes will be concentrated on the U.S. jobs report, especially after the ADP employment report released yesterday showed that the private sector added an all time recorded of more than 300 thousands new job to the private sector.
TheU.S.jobs report is expected to pull most of the attention tomorrow and the pair is expected to remain weak awaiting the release of the report, but in general the euro area region will also release the critical retail sales index and the confidence figures in addition to unemployment rate, which could have lingered at 10.3% in December.
Germanywill join the session at 11:00 GMT with the Factory Orders index for November, where the seasonally adjusted monthly index is projected to drop by 1.6% from the previous expansion of 5.2%, while the non-seasonally adjusted annual index could have fallen by 1.2% from the prior growth of 5.4%.
The euro zone will join the session at 10:00 GMT with Confidence Report of December, where the business climate indicator is expected to drop further to 0.46 from 0.44, while the consumer confidence final index is expected unrevised at -21.2. The economic confidence could have eased to 93.2 from 93.7, while the industrial and services confidence are projected to drop further to 7.5 and 2.1 from 7.3 and 1.7 respectively.
The euro-area region will also provide markets with the Retail Sales index and the Unemployment rate, where the annual retail sales index could have dropped by 0.9% from the previous drop of 0.9%, while the monthly index is projected to fall by 0.4% from the prior expansion of 0.4%. The unemployment rate could have remained unchanged at 10.3%.
TheUnited Stateswill join the session at 13:30 GMT with the Monthly Jobs Report for December, with expectation the economy will add 150 thousands new jobs compared with the prior addition of 120 thousands, yet the unemployment rate is projected to climb to 8.7% from 8.6%. The average hourly earning monthly index could have slightly expanded by 0.2% from the previous drop of 0.1%.
Originally posted here
