The Euro remains strong in the financial market.

The Euro that it will continue to strengthen against the US dollar this year. This is due to the US Federal Reserve appearing to reduce interest rates, while the European Central Bank may maintain higher interest rates going forward.

ING predicts that tighter lending conditions and a soft landing for the US economy could result in a 1% decrease in interest rates in the fourth quarter. ING analyst Chris Turner notes that "Europe's financial sector looks better than the US", adding that "a longer-term hike in the ECB's interest rates targets a EUR/USD rate of 1.15 by year-end."

Currently, investors are focused on US inflation data due today, as there are indications that the US interest rate may reach its peak soon. This is supported by the US labor market's recovery, which was revealed last Friday, and eases concerns about the US economy's worsening slowdown.

Jane Foley, Head of FX Strategy at Rabobank, said, "The Fed's meeting in early May is beginning to emerge and the data heading towards that target is of great interest. She said that the ability of the euro to rise above $1.09 will depend on the data that will occur and its significance for the US interest rate." She added, "Bank revenues are also important. They often do not have direct access to the FX market, but it may be possible, considering the latest developments."

On the yield front, Eurozone bond yields increased rapidly last Tuesday as the European market reopened after the Easter holidays. This was followed by an increase in US government bond yields on Friday and Monday, after data showed strong job creation in March. Germany's 2-year yield (DE2YT=RR) increased by 13 basis points (bps) to 2.673%, while Germany's 10-year yield (DE10YT=RR) increased by 8 bps to 2.259%.

The survey found that investor confidence in the Eurozone improved in April, after unexpectedly declining in March. The index measuring confidence in the Eurozone by Sentix rose to -8.7 in April from -11.1 in March, indicating a further improvement. Analysts predict that the index will be at -9.9 in April. The current situation index also increased for the sixth consecutive month, rising to -4.3 in April from -9.3. Although the index is still negative, it suggests that the economy is no longer in a complete standstill. Sentix stated that "the Eurozone economy has weathered the winter months better than many expected during the autumn months. Warmer weather and efforts to conserve energy have also helped prevent potential energy shortages."

Technical analysis data (5H)