EUR/USD rose today as positive reports allowed traders to speculate that the European Central Bank will refrain from additional monetary easing. In truth, today’s European data was very mixed, but it looks like the Forex market paid attention only to the good part of it. The ECB will hold its monetary policy meeting tomorrow. No changes are expected just yet, but market participants will carefully watch a policy statement to understand if the central bank plans an interest rate cut later.
Leading indicators maintained the pace of growth at 0.7% in September, unchanged from August and in line with forecasts. (Event A on the chart.)
Crude oil inventories increased by 1.6 million barrels last week, matching expectations, and are above the upper limit of the average range for this time of year. The previous week’s increase was at 4.1 million. Total motor gasoline inventories decreased by 3.8 million barrels and are in the upper half of the average range. (Event B on the chart.)
Yesterday, a report on ISM services PMI was released, showing an increase from 54.4% in September to 55.4% in October instead of the expected drop to 54.2%. (Not shown on the chart.)
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