Eurusd rises as euro area consumer confidence improves slightly

EURUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	0.41%	45.9 Pips
Week to-date	1.4%	156 Pips
May	-0.05%	-5.3 Pips

Upcoming key events (London Time)

Thu 01:00 AM EUR G7 Meeting
Thu 08:30 AM EUR HCOB Composite PMI
Thu 08:30 AM EUR HCOB Manufacturing PMI
Thu 08:30 AM EUR HCOB Services PMI
Thu 09:00 AM EUR HCOB Eurozone Composite PMI
Thu 09:00 AM EUR HCOB Eurozone Manufacturing PMI
Thu 09:00 AM EUR HCOB Eurozone Services PMI

What happened lately

In the Euro Area, the Consumer Confidence Indicator demonstrated a slight improvement, moving from -16.7 points in April 2025 to -15.2 points in May 2025. This indicates a moderate enhancement in consumer sentiment, which could be a result of various macroeconomic factors, potentially increasing household spending in the region. A positive shift in consumer confidence usually hints at a more resilient economic outlook as consumers are more likely to increase their expenditure, fostering economic growth. The improvement, albeit small, suggests the Euro Area is experiencing a gradual recovery in consumer sentiment.

Germany’s economic data exhibit a nuanced picture. The monthly Producer Price Index (PPI) saw a slight improvement, decreasing by 0.6% in April 2025 as compared to -0.7% in March. This minor alleviation points to a potential slowdown in deflationary pressure on producers. However, the annual Producer Prices index for Germany showed a significant decline, registering -0.9% in April 2025, a further drop from -0.2% in March. This indicates heightened deflationary trends on an annual basis, suggesting that producers are facing challenges in sustaining pricing power, which could reflect persisting issues in demand.

The impact of this economic data on the EURUSD pair reflects modest optimism. EURUSD witnessed a rise of 0.41% to 1.13281 on Wednesday. The improvement in the Euro Area’s consumer confidence and marginal reduction in Germany’s month’s PPI could enhance the euro’s appeal to investors, although the annual decline in German PPI may introduce caution. These dynamics suggest that the currency pair might experience moderate upward pressure. Investors might also take into account the upcoming high-impact economic events, such as the G7 meeting and various PMI releases, which are anticipated to provide further directions regarding the economic outlook and consequently influence EURUSD movement. Depending on the outcomes of these events, the currency pair might see increased volatility, continuing to impact market participants’ strategies. The overall sentiment is cautiously optimistic depending on forthcoming economic assessments and macroeconomic stability in the region.

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What can we expect from EURUSD today?

EURUSD on Wednesday rose 0.41% to 1.13281. Price is above 9-Day EMA while Stochastic is rising in overbought zone.

Updated daily direction for EURUSD looks bullish as the pair ended higher after Wednesday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.13677 with break above could target R2 at 1.14073 or figure level area. While towards the downside, we are looking at daily low of 1.12787 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.13628 may suggest continuation after recent positive movement.

For the week to-date, take note that EURUSD is bullish as the pair continued to trade higher and is up by 1.4% over the past few days.

Key levels to watch out:

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