EUR/USD Resumes Rally to New Highs

Yesterday’s weakness of EUR/USD was indeed short-lived and the currency pair resumed its rally to new highs today, trading near the strongest level since 2011. The dollar was under pressure amid speculations that this month’s government shutdown will not allow the Federal Reserve to tamper quantitative easing. Today’s data added to concerns as unemployment claims fell less than market participants have hoped for.
US trade balance posted a deficit of $38.8 billion in August, which little changed from July’s $38.6 billion. Analysts have expected an increase to $39.4 million. (Event A on the chart.)
Initial jobless claims fell from 362k to 350k last week, but were above the forecast of 343k. (Event A on the chart.)


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