EUR/USD Goes Higher with Optimism, Reverses Positive Trend

EUR/USD climbed today on the speculation that European leaders will boost the European Financial Stability Facility (the rescue fund). It looks like the optimism was short-live, though, as the currency pair retreated from this day’s high and currently shows tendency to fall. The data from the US continues to be moderately positive, reinforcing the dollar.
CPI increased 0.3% in September on a seasonally adjusted basis, like forecasters predicted. Consumer prices rose 0.4% in August. (Event A on the chart.)
The report about housing starts and building permits was released today. Housing starts were at a seasonally adjusted rate of 658k in September, above the forecast value of 590k and the August reading of 572k. Building permits were at a seasonally adjusted rate of 594k in September, somewhat below the 625k figure in August and the median forecast of 610k. (Event A on the chart.)
Crude oil inventories decreased by 4.7 million barrels, while total motor gasoline inventories decreased by 3.3 million barrels last week. (Event B on the chart.)

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