EUR/USD ended its three-day rally today with a sharp drop that erased this week’s gains. Among reasons for the plunge were very bad reports about industrial production in France (event A on the chart) and Italy (event B on the chart) as well as crisis in Portugal’s banking sector. Meanwhile, US unemployment claims dropped unexpectedly, leading to additional gains of the dollar against the euro. Initial jobless claims dropped from 315k to 304k last week unexpectedly. (Event C on the chart.) Wholesale inventories rose 0.5% in May, in line with expectations, after increasing 1.0% in April. (Event D on the chart.)
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