15.11.201715:01 Forex Analysis & Reviews: Global macro overview for 15/11/2017

Charles Evans, a dovish Chicago Fed official, said in his interview with CNBC television that the yield curve of US debt remains relatively smooth. In his view, FOMC members should pay attention to the dual purpose set in advance, albeit further highlighting the key drivers of consumer price dynamics. Evans allowed inflation to hit 2.0% and an increase in the deviation of the unemployment rate from the NAIRU level by descending below 4.0%. In his opinion, the observed trends in potential output should draw the attention of other members who have time to revise their adopted monetary policy framework.

Looking through the short-term economic factors, it is pretty difficult to find a composite measure of US prices that has on average seen 2.0% annual inflation since the 2007-2008 crisis. In fact, former Fed Chair Ben Bernanke has recently noted that the level of core PCE – the central bank's other preferred inflation measure – remains 4.5% lower than where it would have been had the Fed been successful in meeting its 2.0% target. It's, therefore, no surprise to see current FOMC members like Williams and Evans talking about potential price-level targeting in the future.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. The dollar remains relatively insensitive to his statement as the vertical rally at this pair continues higher. Currently, the price is trading just below the technical resistance at the level of 1.1862 and momentum indicator points to the north despite the overbought trading conditions. The nearest support is seen at the level of 1.1805.