EUR/USD Daily Forecast – 04 December

Thursday brought Spanish and Italian Services PMI data. A re-acceleration of growth was recorded in the Spanish service sector in November, with both business activity and new orders rising at the fastest rates in three months. Greater workloads encouraged companies to raise employment at a faster pace, while sentiment also improved. The headline seasonally adjusted Business Activity Index rose for the second month running in November, posting 56.7 from 55.9 in October. Analysts were predicting smaller incline to 56.2. This was the fastest expansion in activity since August.

EUR/USD Daily Forecast – 04 December

After yesterday's ECB Meeting euro was pushed surprisingly high all the way to 1.09 handle. The cause behind this uptrend is that despite announced monetary measures markets were anticipating something more out of ECB and as a result, pair completely rebounded and broke above recent uptrend line which is of course a bullish sign. Tomorrow, we would pay attention to NFP figures though markets are likely to still be influenced by ECB.

ECB extends its QE programme until March 2017 or beyond

The 25-member Governing Council, meeting in Frankfurt on Thursday, reduced the rate by 10 basis points to minus 0.3 percent. That’s in line with the move forecast by economists. Policy makers left the main refinancing rate and the marginal lending rate unchanged. On the following Press Conference, ECB President Mario Draghi  said that the ECB extends the asset purchase programme to run until March 2017 or beyond if necessary and in any case until the Governing Council sees an improvement in inflation.

Spanish Services PMI up, Italian PMI unchanged in November