The EUR/USD pair underwent a decline, shaking off its overbought conditions.
The main currency pair adopts a neutral stance on Thursday, with the current EUR/USD rate resting at 1.0970.
Over the past day, the currency market has effectively corrected its previously overbought state.
Notably, the U.S. economic statistics revealed interesting dynamics. The Q3 GDP, in its second reading, exhibited a substantial 5.2% q/q growth, surpassing the anticipated 4.9% and the previous 2.1% surge. While a robust report was expected, the market is now contemplating the implications: could such strong consumer demand trigger an acceleration in inflation?
The primary forecast from the U.S. Federal Reserve indicates that the real U.S. GDP will likely have expanded by around 2.1% by the end of 2023.
Today, the market will be flooded with crucial data. October's figures for personal income and spending will be released alongside the core Consumer Consumption Expenditure (PCE) Price Index for the same month. This Core PCE index holds pivotal importance for the Federal Reserve in shaping its credit and monetary policy. The index is anticipated to drop from 3.7% to 3.5% y/y. While a decline in the indicator might be viewed positively by the capital markets, it could be interpreted as locally adverse news for the USD.