The US dollar rose during the week, as the dollar index reaching a three-week high of 94.04, supported by positive retail sales that beat expectations and rose by 0.6% in July. Core retail sales rose by 0.5%.
On the other hand, US stocks fell for a second straight day on Friday, as concerns over Donald Trump's economic agenda mounted. Markets had priced US interest rates hike by almost 40% after the release of the minutes of the Federal Reserve's meeting on Wednesday, which showed members' fear of weak inflation and their view of easing the pace of rate hike.
The EURUSD is currently trading inside a descending channel on the 4-hour chart and as long as it is trading higher the support at 1.1685, we maintain the positive outlook to target the 1.18 / 1.19 levels again.
The German Constitutional Court announced on Tuesday that the European Central Bank (ECB) is violating the rules of monetary financing through the asset purchase program that estimated by 2.3 trillion euros, but the bank's response was decisive to announce that the program falls within its competence in an official statement.
Also, policy makers at the European Central Bank (ECB) during the minutes of the July meeting expressed concern about the risk of the euro overshooting, as the euro hit its highest level since the start of the quantitative easing program two and a half years ago.
In Britain, sterling fell against the US dollar over the week to the lowest level for 5 weeks at 1.2830 at the rising trend line on the weekly chart, following the below-forecast inflation data. The CPI rose by 2.6% in July, easing expectations of Bank of England to raise interest rates soon.
The UK labor market data continued to improve, with unemployment hitting a 42-year low and income up by 2.1% better than expected.
The Reserve Bank of Australia (RBA) was the third bank to issue minutes of the monetary policy committee meeting this week, which continued to confirm the risk of a continued rise in the Australian dollar, which could lead to a slowdown in growth and inflation, with current policy appropriate to the current situation.
Turning to the yellow metal, which rose throughout the week to reach the strong resistance level at 1295 dollars in light of political tensions and economic uncertainty, but failed to exceed this level to decline significantly and is currently trading at levels of 1289 dollars per ounce.