EUR/USD dropped today even as US housing data was exceptionally poor, suggesting that traders will not see quantitative easing tampering this week or, indeed, this year. Not all reports were bad though as industrial production looked pretty solid.
Both industrial production and capacity utilization rate imporved in September. Production expanded 0.6%, above the August rate of 0.4% and the forecast of 0.5%. Capacity utilization was at 78.3%, exceeding the expectations of 78.1% and the previous reading of 77.9%. (Event A on the chart.)
Pending home sales unexpectedly slumped by 5.6% in September. The actual data was far worse than the August change (-1.6%) and nowhere near the predicted growth by 0.5%. The drop was explained by worsening housing affordability and the worsening consumer sentiment, which was hurt by the budget issues. (Event B on the chart.)
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