FX.co ★ Public confidence over Powell's leadership plummeted sharply

Euro is falling due to concerns that US inflation may rebound in April. A recent survey revealed that public confidence in Jerome Powell's leadership on the Federal Reserve plummeted sharply and is now at the the same level or lower than his predecessors. The central bank's success in fighting inflation will be assessed later, but even now, the population is clearly dissatisfied with the policy pursued by the Fed.

According to the poll, only 36% of respondents are confident that the Fed Chairman is acting correctly and doing everything necessary for the US economy. This is lower than the 37% record for Janet Yellen during her first year leading the Fed in 2014. Of course, there is still a difference within the survey's margin of error of plus or minus 4 percentage points. But it is indeed the lowest level listed since 2001.

Confidence in the Fed usually follows the state of the economy. In 2018, when Powell replaced Yellen, he was trusted by about 60% of Democrats and 21% of Republicans. Then, in April 2020, just a month after the Covid-19 quarantine was introduced, confidence in Powell was at 58% - the highest approval rating for any Fed chairman since Alan Greenspan in 2004. But as inflation rose and the Fed began raising interest rates, Powell's approval dropped sharply.

Confidence in key political figures in the US has been disappointing lately. Incumbent President Joe Biden is also not enjoying great success with the population, let alone banking workers.

In terms of the forex market, euro bulls have fewer chance to continue a rally. In order to do so, the quote has to stay above 1.0940 and take control of 1.0970 along with 1.1000. This will allow a rise beyond 1.1030, heading towards 1.1060. In case of a decline around 1.0940, the pair will fall to 1.0910 and 1.0870.

In GBP/USD, bulls are controlling the market, nut to see further growth, the quote has to consolidate above 1.2630. Only that will trigger a much larger rise to 1.2665 and 1.2710. In case there is a decline, bears will attempt to take 1.2600, which could lead to a fall to 1.2560 and 1.2520.