The Euro which is typically the most interesting currency to trade has become the most boring. The EUR/USD has been stuck within a 50 pips trading range for the past 24 hours and a quick look at the charts will reveal a tight trading range for the past week.
With the European Central bank scheduled to meet on June 6, incoming economic data has done little to clarify whether the central bank will raise rates beyond June. Yesterday, we had a very strong current account number, but today, Eurozone retail PMI dropped back into contractionary territory. This suggests that consumer spending was very weak in April and or May. In addition to that disappointment, M3 money supply which is an inflationary indicator also fell short of expectations, signaling that inflationary pressures may be abating. It may seem that data is beginning to weaken, but there are still a lot of data that could shift the outlook either way. In the next 24 hours, we are expecting German and French unemployment along with French PPI and Eurozone consumer confidence. Meanwhile the Swiss franc is stronger against the Euro ahead of its first quarter GDP release tomorrow. The weakness of the franc should lead to stronger growth.