EURUSD returns to balance. Overview for 16.11.2023

The main currency pair is correcting its positions on Thursday. The EURUSD exchange rate currently stands at 1.0832.

Industrial production in the eurozone in September dropped by 1.1% m/m, proving to be weaker than expected (-0.9%). The index had risen by 0.6% the previous month. Logically, the production sector is facing challenges due to high prices in the region, just like other sectors.

Yesterday, the US presented a new block of important statistics. For example, retail sales in October dropped by 0.1% m/m, falling short of the expected decline of 0.3% and the previous growth of 0.9%. The Producer Price Index in October was 1.3% y/y, lower than the forecast of 1.9% y/y.

The drop in the PPI comes as no surprise: the market saw a robust inflation report yesterday, setting the tone for subsequent price publications. Other components of inflation releases might also indicate signals of a decline. All these are consequences of the US Fed's tight monetary policy and the constrained interest rate level.

What is noteworthy today in the Eurozone is a speech by ECB governor Christine Lagarde. The US will release an industrial production report and its components, as well as the weekly unemployment claims report.

The dollar has overcome the initial stress and now needs stabilisation.