EUR/USD Slumps on Draghi Comments

EUR/USD slumped today as European Central Bank President Mario Draghi said that the central bank isn’t going to buy bonds to support the European economy. The ECB decreased its main interest rate by 25 percentage points to 1.00% (Event A on the chart) and that send the euro higher at first. The European currency then tumbled as the bank signaled that there isn’t much more it can do to stem the region’s crisis. The US data was supportive to the dollar as the unemployment claims dropped more than expected.
Initial jobless claims fell 381k last week from the previous week’s revised figure of 404k. That’s a bigger drop than the expected decrease to 397k. (Event B on the chart.)
Wholesale inventories were up 1.6% in October on the seasonally adjusted basis, while the September change was revised from -0.1% to 0.0%. An increase by 0.4% was predicted by market analysts. (Event C on the chart.)


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