EUR/USD is driven up by weak dollar
By Elizabeth Belugina
EUR/USD returned back to 1.1400 on the general weakness of the US dollar. European GDP reading are rather positive: growth accelerated from 0.3% to 0.6%. Both the French and Spanish economies expanded. However, inflation in the euro area slowed to -0.2% in April. This means that the European Central Bank will continue its loose policy.
German Bundesbank President Jens Weidmann and the ECB President Mario Draghi will speak on Monday. German authorities don’t approve extreme policy easing done by Draghi, so we'll closely watch their comments. Thursday will be the day of German and French bank holiday. Other events include release of the region’s producer price index on Tuesday and the EU economic forecasts on Friday.
Still, the main driver for the pair will come from the US. Lower American GDP growth in Q1 and moderate Federal Reserve’s statement landed a blow on USD, and it will be important to watch American economic calendar next week.
Technically EUR/USD broke above the line connecting April highs, so resistance at 1.1460 and 1.1550 is now in sight. Support is at 1.1350 and 1.1200.