The euro is steady on Friday after jumping 0.7% a day earlier. In the European session, EUR/USD is trading at 1.0581, down 0.06% at the time of writing.
The eurozone wraps up the week with the GDP and job growth reports and the market is expecting an improvement. Third-quarter GDP is expected to improve to 0.4% q/q from o.2% in the second quarter. Job growth if forecast to tick upwards to 0.2% q/q, up from 0.1% in Q2.
In France, the political chaos continues. A no-confidence vote passed this week and has left the country without a functioning government. Prime Minister Michel Barnier resigned on Thursday after just three months in office. President Emmanuel Macron said he will name a new prime minister shortly but the political crisis could push up French interest rates and the country’s large debt.
Germany, once the powerful locomotive of the eurozone, has faltered badly and has hampered growth in the eurozone. This week’s German manufacturing data was dismal. The Manufacturing PMI remains mired in contraction and was unchanged at 43.0 in November. Factory orders for October declined by 1.5% after a 7.2% gain a month earlier. On Friday, industrial production fell 1% in October, after a 2% decline in September and shy of the market estimate of 1.2%.
The German Services PMI slipped into contraction in November and there is political instability, as the coalition German government collapsed in November. A snap election has been scheduled for Feb. 23, 2025.
The US wraps up the week with the nonfarm payroll report. With inflation largely contained, the employment growth is once again a key release can move the US dollar. The November report is expected to rise to a respectable 200 thousand, after a weak gain of 12 thousand in October, which was driven downwards by hurricanes and work stoppages at Boeing.
EUR/USD Technical
- EUR/USD faces resistance at 1.0615 and 1.0644
- 1.0562 and 1.0533 are providing support
