When is the US GDP report and how could it affect EUR/USD?

US Q2 GDP Overview

Thursday's US economic docket highlights the release of the Prelim GDP print for the second quarter, scheduled at 12:30 GMT. The second estimate is expected to show that growth in the world's largest economy accelerated by a robust 6.7% annualized pace during the April-June period as against the advance estimate for a 6.5% increase.

How Could it Affect EUR/USD?

The backward-looking report is unlikely to provide any meaningful impetus as the market focus remains on the likely timing of the Fed's plan to begin rolling back its pandemic-era stimulus. Hence, the key focus will remain on Fed Chair Jerome Powell's speech at the Jackson Hole Symposium.

Nevertheless, a stronger reading will add to speculations that the US central bank will reduce the pace of its massive asset purchases later this year. This might be enough to provide a modest lift to the US dollar, though any immediate market reaction is likely to be short-lived.

Ahead of the key release, the EUR/USD pair was seen oscillating in a range near one-week tops, consolidating its recent bounce from YTD lows. Yohay Elam, Analyst at FXStreet offered a brief technical outlook for the major: “Euro/dollar has surpassed the 100 Simple Moving Average on the four-hour chart and benefits from upside momentum while trading below the 200 SMA. Overall, bulls are in the lead but do not have full control.”

Yohay further provided important technical levels to trade the pair: “Resistance awaits the daily high of 1.1775, followed by 1.1805, last week's peak. Further above, 1.1825 and 1.1860 await EUR/USD. Support is at 1.1750, which capped the currency pair early this week, and then by 1.1725, which provided support in recent days. Further down, 1.1695 and 1.1660 are eyed.”

Key Notes:

   •  EUR/USD Forecast: One step down, two steps up? Why the dollar is set to extend its falls

   •  EUR/USD still remains capped by 1.1800 ahead of ECB, Jackson Hole

   •  EUR/USD to climb towards the 1.20 area on a close above downtrend at 1.1772 – Commerzbank

Description

The Gross Domestic Product Annualized released by the US Bureau of Economic Analysis shows the monetary value of all the goods, services and structures produced within a country in a given period of time. GDP Annualized is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for equities, while a low reading is negative.