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EUR/USD and GBP/USD: The US passed a spending bill of 1.4 trillion dollars. The euro will remain under pressure, and the

The US dollar strengthened against the euro and the pound after the news that the US Senate approved the first of two spending packages to avoid government shutdown was released. The spending bill was passed after significant changes were made to the pension system. The White House said that President Trump would approve measures to provide nearly $1.4 trillion in spending.

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The document states that in addition to the main items, expenses will be increased by adding 3.1% to the salaries of military and civil servants of the Federal government. An additional $ 425 million has also been allocated to ensure security during the elections, which will be held next fall. About $ 1.38 billion was sent to build a fence along the U.S. border with Mexico, which remains a major contentious issue. Let me remind you that at the end of last year, the problem of financing the construction of the wall on the southern border was the longest suspension of government activity in the history of the United States.

As for yesterday's fundamental statistics on the United States, the dollar was not generally affected. The number of Americans applying for unemployment benefits for the first time has also fallen, confirming the healthy state of the labor market.

The U.S. Department of Labor reports that the number of initial applications for unemployment benefits for the week of December 8-14 fell by 18,000 to 234,000, contrasting economists' expectation of 227,000. The moving average of applications also rose by 1,500 to 225,500. As for the number of secondary applications, from December 1 to 7, it increased by 51 000 and amounted to 1.72 million.

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The good news for Donald Trump was the report on the current account deficit of the US balance of payments, which decreased in the 3rd quarter. This characterizes the degree of trade and financial flows between the United States and other countries. According to the report of the US Department of Commerce, the deficit amounted to 124.09 billion US dollars against the 125.21 billion dollars in the 2nd quarter of 2019. This is in contrast to economists' expectation of $ 121.9 billion in Q3.

First of all, the reduction of imports of goods and the growth of investment income contributed to the reduction of the deficit.

Meanwhile, data on manufacturing activity in the area of responsibility of the Federal Reserve Bank of Philadelphia did not impress traders. According to the report, while economists had expected the figure to be 8 points, the PMI in December fell to 0.3 points from 10.4 points in November.

U.S. home sales in the secondary market also fell in November, as limited supply is holding back buyers, in spite of credit availability. Seasonality also affects the decline in sales, as a report by the National Association of realtors indicated that sales in the secondary housing market in November 2019 fell by 1.7% compared to the previous month and amounted to 5.35 million homes per year. Economists had expected sales to fall 0.4 percent. On the other hand, sales in November rose 2.7%, compared with the same period the previous year,

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Data from the Conference Board also did not have much impact on the volatility of the euro. The report showed that the index of leading indicators in November was 111.6 points, whereas economists predicted that the index will grow by 0.1%.

As for the technical picture of the EUR/USD pair, after an unsuccessful attempt to update Wednesday's highs, the pressure on risky assets returned immediately after the bears pushed the trading instrument below the level of 1.1140. So far, this range remains to be a problem for the bulls, and only its breakdown will increase the probability of the further growth of EUR/USD in the area of highs 1.1170 and 1.1210. However, the pressure on risk assets is likely to continue. The breakout of the 1.1110 level will increase the pressure on the euro, which will push the pair to the lows of 1.1080 and 1.1040. A larger movement within the current range is unlikely, as traders do not have clear guidance from central banks by the end of the year, and much will depend on the incoming fundamental data.

GBP/USD

Pressure on the British pound will gradually weaken after yesterday's statements of the Bank of England on the situation with interest rates. In addition, today's data on consumer confidence in the UK provided little support to the pair. The increase in confidence was directly related to optimism about the situation in the economy, which should improve next year. According to the report of the research company GfK UK, consumer confidence index in December this year rose by three points to -11 points.

Growth was noted in sub-indexes of the expectations of large and personal finances.

As for the technical picture of the GBP/USD pair, the pressure on the pound is clearly slowing down, as today's UK GDP data may be the final chord for profit-taking on short positions gained by major players after the elections of the UK Parliament. Major support levels are seen in the area of 1.2890 and 1.2950.

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