EUR/USD was falling today, but later rebounded and touched the highest rate since December 2011. The Forex market is in the risk-on mode and that drives the currency pair higher. The US data was mixed today as the housing market continued to show signs of strength, but consumer sentiment dropped more than was expected. As for news from Europe, the German consumer climate was stable, indicating that the economic environment in Europe is improving. (Event A on the chart.) S&P/Case-Shiller home price index rose from 144.08 in October to 144.99 in November. The annual growth was 5.5%, matching forecasts exactly. The year-on-year increase in October was 4.2%. (Event B on the chart.) Consumer confidence fell from 66.7 in December (revised up from 65.1) to 58.6 in January. Analysts have hoped for higher reading of 64.8. (Event C on the chart.)
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