The pressure on the euro rose slightly by the end of the day on Monday, after it became known that the Italian government approved the draft budget law for the following year.
The draft budget law of Italy for next year submitted to parliament.
Let me remind you that the Italian authorities have taken a number of measures that in the future will lead to a rapid increase in the budget deficit, which will only increase the conflict with the European Union.
As it became known, the government has not moved away from its plans, and the measures planned in the draft budget include increasing the deficit to 2.4% of GDP. A number of experts fear that 2.4% is not the final figure, and that the real deficit of Italy may significantly exceed this target range.
By Saturday, this draft budget will be submitted to the Italian Parliament, which will have time to adopt it before the end of the year.
The focus of the new Italian authorities will focus on the growth of social security and pensions. The emphasis is also made on the side of tax cuts, which largely affects the expenditure side.
Fundamental Statistics for the USA
Yesterday's data on the US economy did not lead to a serious fall in the US dollar, although a weak increase in consumer spending in September of this year may affect future prospects for GDP growth.
According to a report by the US Department of Commerce, retail sales in September rose by only 0.1%, to $ 509 billion. Compared to the same period of the previous year, sales increased by 4.7%. Economists had expected a monthly increase in sales to increase by 0.7%. Data for August has been revised. The growth was also 0.1%.
As noted in the report, the main drop in sales was due to catering outlets, where the decline was 1.8%. But car sales rose 0.8% after a decline of 0.5% in August.
Growth data manufacturers in the area of responsibility of the Federal Reserve Bank of New York supported the US dollar in the afternoon. According to the report, the Fed-New York manufacturing index in October of this year rose to 21.1 points from 19 points in September. Economists predicted that the index will be 19.3 points.
The growth of inventories of companies has not yet raised any significant concerns. According to the US Department of Labor, inventories of companies in the United States in August of this year grew by 0.5% and amounted to 1.96 billion dollars. Economists had expected stocks to grow by 0.5%.
The speech of the former Fed Chairman Janet Yellen, which took place yesterday, went against the statements of the current representatives of the Federal Reserve System.
Yellen seriously stated that she was concerned about the possible overheating of the economy. In her opinion, GDP growth at the level of 3% will not be preserved and will not be sustainable, and to prevent economic imbalances, the economy should slow down.
As for the technical picture of the EUR / USD pair, further uncertainty in the market can lead to a decrease in volatility and a sideways channel.
Currently, the lower limit is the area of 1.1535, while the upward potential of the trading instrument is limited to resistances of 1.1605, going beyond which will open the way to new weekly highs of 1.1650 and 1.1700.
The material has been provided by InstaForex Company -
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