EUR/USD surged today as eurozone annual inflation was at 0.8% in February, a bit higher than was expected, and the unemployment rate remained unchanged in January. (Event A on the chart.) The positive data reduced chances for additional monetary stimulus from the European Central Bank on the next week’s policy meeting. US reports were mixed today.
US GDP grew 2.4% in Q4 2013, according to the preliminary estimate, revised down from the advance value of 3.2%. The actual reading was lower than the median analysts’ projection of 2.6% and the Q3 growth of 4.1%. (Event B on the chart.)
Chicago PMI was broadly unchanged at 59.8 in February from 59.6 in January, avoiding a drop to 57.9 that some economists were afraid of. (Event B on the chart.)
Michigan Sentiment Index was at 81.6 in February, near the predicted value of 81.4 and the preliminary reading of 81.2, which was the same as the January figure. The report said that consumer confidence was mostly unaffected by the harsh winter weather. (Event C on the chart.)
Pending home sales were almost unchanged, rising by just 0.1% in January. The actual figure was nowhere near the expected increase of 2.9%. The December change was revised positively from -8.7% to -5.8%. The report noted that home inventories remain limited, constraining sales and increasing prices. (Event D on the chart.)
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