EURUSD on Wednesday remains strong. The current quotes is 1.0950.
The statistics yesterday turned out mixed. The PPI in the Euro zone in February dropped by 0.5% m/m, as expected. A month before, this index had dropped by 2.8%. The situation looks logical because we have already had several signals about a slowdown in inflation growth. The factory order volume in the US if February dropped by 0.7% m/m, which exceeded expectations.
All the strength of the EUR is based on the weakness of the USD. Due to the recent US statistics being so unimpressive, the market becomes more and more confident that the Fed will slow down the tightening of the monetary policy.
Previously, investors were sure that the Fed would go on fighting with inflation no matter what. But now, when there become less and less resources inside the economic system, some start doubting the persistence of the Fed.
If in the nearest future we see more signals that the Fed will make a pause in tightening its monetary policy, the USD should decline even deeper.