Euro Recovers Against US Dollar on Weak Housing Data

The euro today recovered the ground it had lost against the US dollar during the early European session after the release of disappointing US housing data. The euro was largely weaker against the US dollar for most of the European session despite an early morning speech by Mario Draghi, the President of the European Central Bank.

The EUR/USD currency pair recovered most of the ground it had lost earlier in the session when it was trading at a 7-day low of 1.1729.

The euro was largely weaker against the US dollar due to some of the political events in the Eurozone such as the uncertainty regarding the Catalan independence movement and the Brexit negotiations. The release of the Eurozone construction output data for August by Eurostat could not boost the single currency. Mario Draghi’s speech in Frankfurt early in the European session had minimal impact on the single currency because its lacked monetary policy content.

The US dollar was stronger against the euro at the beginning of today’s session, as tracked by the US Dollar Index, but weakened after the release of disappointing housing data. The release of the housing starts and building permits data by the Census Bureau in the early North American session caused the euro to rally against the greenback; the euro recovered most of the ground it had lost earlier today.

The currency pair’s future performance is likely to be determined by the release of the US jobless claims data tomorrow.

The EUR/USD currency pair was trading at 1.1778 as at 16:17 GMT having rallied from a low of 1.1729. The EUR/JPY currency pair was trading at 133.02 having risen from a low of 131.97 earlier today.

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