The euro today dropped to new lows against the US dollar following the ECB President Mario Draghi‘s dovish comments during a speech in Frankfurt. Mixed releases from the Eurozone such as Germany’s Consumer Price Index for February could not reverse the euro’s decline.
The EUR/USD currency pair lost over 60 points to decline from a high of 1.2412 to a low of 1.2348 at the time of writing.
The main trigger behind the currency pair’s decline was Mario Draghi’s speech in the early European session where he stated that the European Central Bank was concerned about the low inflation rates in the euro block. The German CPI released by the Federal Statistical Office met expectations by coming in at an annualized 1.4%, but had a muted impact on the currency pair. The Eurozone industrial production data for January released by Eurostat came in at an annualized 2.7%, which was lower than the expected 4.4%, and contributed to the pair’s decline. The Eurozone employment data for Q4 2017 came in at an annualized 1.6%, which was slightly higher than the previous 1.7%.
The release of the US advance retail sales data by the Census Bureau, which recorded a 0.1% decline as opposed to the expected 0.3% growth, gave the pair a brief respite. However, the pair quickly resumed its downtrend as the US dollar recovered against its peers as tracked by the US Dollar Index.
The currency pair’s future performance is likely to be affected by tomorrow’s US import price index and initial jobless claims data.
The EUR/USD currency pair was trading at 1.2355 as at 15:35 GMT having declined from a high of 1.2412. The EUR/JPY currency pair was trading at 131.16 having dropped from a high of 132.28.
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