EUR/USD is trading at $1.3271, up 0.1% on the day, following news that the number of people unemployed in the eurozone dropped by 24,000. This is the first decline in two years. The drop in the jobless rate wasn’t large enough to change the official rate from 12.1%, but it is progress none the less. Traders bought the euro on the back of this, as they felt the eurozone could be at a turning point.
Later today, the US will release the latest ADP employment change report, and economists are expecting 179,000 private sector jobs to be created. This could also give us an indication of what is in store for the non-farm payrolls on Friday.
The Federal Reserve will make an announcement at 7pm, and this will be the most important economic event of the day. The Federal Reserve has made it very clear that its stimulus package will be tapered when the economy improves. Traders will therefore be listening out for hints as to when the quantitative easing programme will be trimmed. If it is in the near future, we could see a drop in the euro.