Euro Zone economy keeps contracting as the ECB cannot find a balance.pair maintained the bearish path, bottoming on Friday at 1.0614, the lowest since last March. The pair heads into the weekend, trading a handful of pips above the level as investors continue to bet on the US Dollar.
Finally, Powell said that a soft landing is a “plausible outcome” but clarified he does not see it as a baseline scenario. “Ultimately, this may be decided by factors outside of our control at the end of the day, but I do think it’s possible,” Powell said. “I also think this is why we are in a position to move carefully again. We will restore price stability, and we know we have to do that, and we know that the public depends on us doing that.
Furthermore, the US released Initial Jobless Claims data on Thursday, which came in much better than anticipated at 201K for the week ended September 15, suggesting the labor market is still far from cooling. Furthermore, S&P Global released the preliminary estimates of the September PMIs, and the report brought more bad news. “The eurozone private sector remained in contraction at the end of the third quarter of the year as waning demand led to a further decline in activity,” the official report reads. Manufacturing output index contracted to 43.4, while services activity posted a modest improvement but the index remained below 50, reaching 48.4. The Composite PMI resulted at 47.
The weekly chart shows that a bearish 100 Simple Moving Average provided dynamic resistance, maintaining its bearish slope at around 1.0730. The 20 SMA, in the meantime, gains bearish traction above the longer one, in line with persistent selling interest. Meanwhile, the Momentum indicator heads firmly south within negative levels, while the Relative Strength Index indicator consolidates at around 41, skewing the risk to the downside.