When are the US macro releases and how could they affect EUR/USD?
|US economic data overview
Thursday's US economic docket highlights the releases of the final Q1 GDP print, Durable Goods Orders and Initial Weekly Jobless Claims, scheduled at 12:30 GMT. The third estimate is expected to confirm that the US economic growth during the January-March period stood at 6.4% annualized pace, matching the preliminary release.
Separately, the US Durable Goods Orders are expected to have increased by 2.7% in May as against the 1.3% decline recorded in the previous month. Orders ex-transportation and Nondefense Capital Goods Orders ex-aircraft are projected to rise by 0.7% and 0.6%, respectively, down from April's 1.0% and 2.2%, respectively.
Meanwhile, Initial Jobless Claims are forecast to drop sharply to 380,000 during the week ended June 18 as against the previous week's reading of 412,000. Continuing Claims are expected to fall further to 3.46 million from 3.518 million previously.
How could it affect EUR/USD?
Ahead of the key releases, a generally softer tone surrounding the US dollar extended some support to the EUR/USD pair. That said, a modest pickup in the US Treasury bond yields acted as a tailwind for the greenback and kept a lid on any meaningful upside for the major. Against the backdrop of a sudden hawkish turn by the Fed, surprisingly stronger US macro data might be enough to provide a goodish lift to the greenback. Conversely, a more dovish ECB would offset any disappointment from the US macro data, suggesting that the path of least resistance for the major remains to the downside.
Meanwhile, Pablo Piovano, FXStreet's own editor, provided important technical levels to trade the pair: “EUR/USD expects to meet a minor resistance at a Fibo retracement at 1.1976 ahead of the more significant barrier at the critical 200-day SMA, today at 1.1993. Further north comes in the psychological yardstick at 1.20 the figure. Above the 200-day SMA, the selling pressure is expected to alleviate somewhat.”
Key Notes:
• US Durable Goods Orders May Preview: Is the consumer really absent?
• EUR/USD Forecast: Downside pressure mitigated above the 200-day SMA
• EUR/USD keeps focused on 1.1970 – UOB
About the US economic data
The Gross Domestic Product Annualized released by the US Bureau of Economic Analysis shows the monetary value of all the goods, services and structures produced within a country in a given period of time. GDP Annualized is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the USD, while a low reading is negative.
The Durable Goods Orders, released by the US Census Bureau, measures the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, such as motor vehicles and appliances. As those durable products often involve large investments they are sensitive to the US economic situation. The final figure shows the state of US production activity. Generally speaking, a high reading is bullish for the USD.
The Initial Jobless Claims released by the US Department of Labor is a measure of the number of people filing first-time claims for state unemployment insurance. In other words, it provides a measure of strength in the labor market. A larger than expected number indicates weakness in this market which influences the strength and direction of the US economy. Generally speaking, a decreasing number should be taken as positive or bullish for the USD.
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