The “greenback” rose. Overview for 15.12.2021

EURUSD continues falling; today’s a very important day. 

The major currency pair remains rather weak in the middle of the week. The current quote for the instrument is 1.1271.

At first, the Euro got some support from the statistics published by the Euro Area: the Industrial Production added 1.1% m/m in October after losing 0.2% m/m in September. However, market expectations were more optimistic and sentiments in the pair immediately reversed. 

As for the US, the PPI skyrocketed by 0.8% m/m in November after expanding by 0.6% m/m in October and against the expected reading of 0.5% m/m. On YoY, the indicator added 9.6% after showing 8.6% the month before and against the preliminary reading of 9.2%. The Core PPI expanded by 0.7% m/m, twice as much as the expected reading. 

It’s clear that all prices are rising in the US and that’s a very important signal for the regulator, which is about to finish its session later today. 

So, today is a very important day. Market players believe that the Fed may decide to boost the QE programme closure and terminate it as early as March 2022. Apart from that, it will be very interesting to hear what the Fed has to say about the number of rate hikes until the end of 2022. Average market expectations imply two hikes with a total of 50 basis points. If there are more hikes, the “greenback” will get significant support.

No matter what happens, the evening is promising to be quite volatile.