The EUR/USD pair moved within a narrow range during the Asian session on Friday (November 14th). The pair appeared to be consolidating after a strong rally to a more than two-week high reached the previous day. Price-wise, EUR/USD remained around 1.1635, barely changing on the day and remaining just below the key 50-day moving average, which now serves as the upper limit that must be broken.

On the US dollar side, pressure remains. The greenback struggled to attract buyers and remained near a two-week low due to concerns about the economic impact of the prolonged US government shutdown. This condition provided support for EUR/USD. At the same time, the divergence in policy expectations between the Federal Reserve and the European Central Bank has supported the EUR/USD uptrend that has been underway for the past two weeks.

Several Fed officials have begun to signal more caution regarding further interest rate cuts due to the lack of recent economic data. However, the market still rates a roughly 50% chance that the Fed will cut rates again in December. On the other hand, most economists expect the ECB to hold its deposit rate unchanged throughout this year and leave it unchanged until the end of next year. This difference in policy direction is what keeps the EUR/USD outlook tending to be positive, although buyers still need confirmation by breaking the 50-day moving average (MA).

Meanwhile, a senior White House official said key US economic data for October—such as the employment and inflation reports—might not be released at all. This situation makes the market increasingly dependent on comments from FOMC members for clues about the direction of the Fed's interest rate, which will automatically affect demand for the USD. On the other hand, the release of preliminary (flash) Eurozone GDP data for the third quarter has the potential to provide new impetus for the euro and open up attractive trading opportunities around the EUR/USD pair. (az)

Source: Newsmaker.id