On Friday evening, news emerged that US President Donald Trump was imposing a state of emergency since the US Congress was unable to agree on the allocation of the necessary funds for the construction of the wall. The White House said that the introduction of a state of emergency would allow the use of funds intended for other items of expenditure. A total of $ 8 billion is planned to be spent on the construction of a wall on the border with Mexico.
The American president said on Friday that he was going to impose a state of emergency to solve security problems at the border, and soon all the documents needed for that would be prepared. Trump noted that the construction of the wall is a key point for national security, and is ready to be sued because of the decision to declare a state of emergency.
As for the trade talks that took place last week, the US president announced good results, which leaves hope for the preservation of good relations between the US and China. Trump expects the second summit with the DPRK leader to be as successful as the first.
The US dollar, which showed growth in the first half of the day against the euro and a number of other world currencies, then fell sharply again after the release of weak fundamental data indicating a slowdown in US economic growth.
According to the report, industrial production in the United States in January 2019 declined sharply. This happened because of a serious decline in the production of cars.
According to the US Federal Reserve, industrial production fell by 0.6% in January compared with December 2018. Economists had expected industrial production to grow by 0.1%. Compared with January 2018, industrial production grew by 3.8%.
Manufacturing production in January fell by 0.9%, while production in the mining sector grew by only 0.1%. Capacity utilization in January fell to 78.2%. Current economic data indicates that the US economy is strong enough, but shows a slight decline.
A good report on the growth of American consumer optimism came to the aid of the US dollar in the afternoon. The increase mainly occurred after the completion of the suspension of the US government, as well as against the backdrop of the fact that the Federal Reserve took a pause in the process of raising interest rates.
According to leading data from the University of Michigan, the consumer sentiment index in February 2019 was 95.5 points versus 91.2 points in January.
Import prices in the US declined in January, indicating a slowdown in inflation.
As stated in the report of the US Department of Labor, import prices in January 2019 fell by 0.5% compared with December, while economists had expected a fall in prices compared to December of 0.3%. Compared to the same period of the previous year, prices fell by 1.7%.
On Friday, a report was also released, which testified to business growth in the area of responsibility of the Federal Reserve Bank of New York. According to the data, the Fed-New York manufacturing index rose to 8.8 points in February against 3.9 points in January. Economists had expected the February index to be 7 points.
As for the technical picture of the EURUSD pair, euro buyers can "exhale". Trade has moved above the level of 1.1280, and demand for the euro may continue in the near future. The main task will be fixing above the maximum of 1.1325, which will strengthen the demand for risky assets and lead the trading instrument to last week's highs of 1.1360 and 1.1400.
The material has been provided by InstaForex Company - www.instaforex.com