EUR / USD: Republicans got a majority in the Senate. German growth may slow down

Victory, on the one hand, losing from the second. Today, it became known that representatives of the Republican Party managed to preserve the majority in the US Senate after the midterm elections, where they managed to oust the two existing Democratic senators, which made it possible to create a majority. Now, the Republicans in the Senate is 51 seats out of 100. Despite the victory, it also became known that the Democrats weakened Republican influence in the House of Representatives. This suggests that the Democrats were able to regain control of the House of Representatives after eight years of leadership of the Republicans there.

Keeping control over the Senate will allow Donald Trump to continue to pursue his policies and implement his political plans. It will also allow the US president to avoid the impeachment that the Democrats are seeking so much. Even if the democratic party manages to get a majority of votes, further hearings should take place in the Senate, where the Republicans have an advantage. And for impeachment, the voices of two thirds of the senators are necessary.

In any case, Trump won another confident victory that will make the White House even stronger.

From the economic data that came out yesterday in the afternoon, attention should be paid to the US Department of Labor report, according to which in September, 7.01 million vacancies were recorded, while the number of people trying to find a job in the country in September was 5.96 million. The figure for August was revised upwards to 7.29 million vacancies.

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Tomorrow, the decision of the Federal Reserve System on interest rates will be published. Most likely, the Central Bank will leave them unchanged, but there are economists who believe that the Fed may raise rates already in November of this year. However, such a decision may cause more harm than good, as it will negatively affect the medium-term plans of many market participants, who will have to revise their strategies. Economic indicators with rising inflation do not create such a sharp need to raise rates.

Yesterday, a forecast from Oxford Economics was published, in which economists lowered expectations for growth in Germany this year. According to the data, the company expects that the country's GDP in the 3rd quarter of this year will shrink by 0.2%, whereas previously they expected the economy to grow by 0.2%. For the 4th quarter, the forecast remained more positive. It is expected that the German economy in the 4th quarter will grow by 0.6% from 0.5%.

As for the technical picture of the EUR / USD currency pair, much will depend on whether buyers will be able to hold their positions above the support level of 1.1430, a breakthrough of which will lead to an immediate sale to the lower border of the channel 1.1390. Given that there will be no changes in the Fed policy, the demand for the euro should remain, but this requires a breakthrough of the major resistance of 1.1470, which will resume the uptrend and lead to a maximum of 1.1515 and 1.1550.

The material has been provided by InstaForex Company - www.instaforex.com