EUR/USD dropped today, erasing yesterday’s gains and touching the lowest level since August 2010, on fears of potential credit downgrades of European countries by Standard & Poor’s. Confidence of US consumers improved more than was predicted, but trade balance deficit widen more than was forecast, while import and export prices declined.
Trade balance deficit rose to $47.8 billion in November up from $43.3 billion in October. Not a good news as only a little increase to $44.8 billion was predicted by market analysts. (Event A on the chart.)
US import and export prices fell in December. Import prices dropped 0.1%, following the 0.8% increase in November, while they were expected to stay unchanged. Export prices declined 0.5%, following the 0.1% advance in the month before. (Event A on the chart.)
Michigan Sentiment Index rose from 69.9 (revised from 67.7) in December to 74.0 in January, according to the preliminary estimate. An average forecast was 71.2. (Event B on the chart.)
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