The euro and franc found themselves in the red as risk-taking picked up in the previous week. What’s coming up next?
Only low to mid-tier reports are on this week’s docket for both European currencies, so the focus might stay on overall market sentiment.
Here are the potential catalysts to watch out for:
ECB head Lagarde’s speech (May 27, 8:30 am GMT)
- Head of the central bank is due to speak about the ECB’s response to the coronavirus at the European Youth Event 2020
- Optimistic remarks on the Franco-German recovery plan might keep the shared currency supported
- Lagarde’s speech comes after the release of the ECB Financial Stability Review on May 26, 2:00 pm GMT
- Updates on the Pandemic Emergency Purchase Program are also expected, with speculations for an increase of 200-250 billion EUR next month
Mid-tier euro zone data
- German preliminary CPI (May 28) to tick 0.1% higher after previous 0.4% gain
- German import prices (May 29, 7:00 am GMT) to show 1.5% drop after earlier 3.5% slump
- German retail sales (May 29) to take 10.0% hit in April
- French consumer spending (May 29, 7:45 am GMT) and CPI likely to print dips as well
- Eurozone flash headline CPI (May 29, 10:00 am GMT) to come in at 0.4% and core CPI to hold steady at 0.9%
Low-tier Swiss data
- Trade balance due May 26, 7:00 am GMT
- Credit Suisse Economic Expectations index (May 27, 9:00 am GMT) to dip from earlier 12.7 reading
- KOF Economic Barometer (May 29, 8:00 am GMT) to improve from 63.5 to 70.2
Overall risk appetite
- Market watchers are still keeping tabs on the COVID-19 pandemic, with stronger reactions to positive developments like quarantine measures being eased or vaccine trials going well
- Tensions between the U.S. and China also impact risk sentiment, along with brewing conflict in Hong Kong
- Short-term moving averages signal that the majority of EUR pairs are in bullish but weakening territory.
- Only EUR/AUD and EUR/NZD are in the bearish region.
- Stochastic shows that EUR/JPY and EUR/GBP might also see a return in selling pressure as both pairs are overbought.
- Franc pairs are also looking mixed, based on moving averages.
- The 50 MA suggests that most pairs are bullish, but the longer-term 200 MA is giving off bearish signals.
Missed last week’s price action? Read the EUR & CHF price recap for May 18 – 22!