Dollar Loses Ground to Euro After Disappointing US Data

EUR/USD edged higher during the first trading day of this week as the majority of US macroeconomic reports missed expectations. This led to concerns that nonfarm payrolls released this week will be not as good as analysts predict.
Personal income rose 0.3% in December while personal spending fell at the same rate. This is compared to the forecasts of a 0.2% increase and a 0.1% drop respectively. The growth of both income and spending was negatively revised for the previous reporting period. Income was revised from 0.4% to 0.3% while expenditures got a revision from 0.6%. (Event A on the chart.)
ISM manufacturing PMI dropped from the December’s reading of 55.1% to 53.5% in January (seasonally adjusted), below market expectations of 54.9%. (Event B on the chart.)
Construction spending rose 0.4% in December from the previous month, trailing analysts’ projections of 0.9% Still, it was a better reading that the November’s -0.2%. (Event B on the chart.)

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