EUR/USD Declines on Positive Revision of US Q4 GDP Data

The EUR/USD currency pair today declined to new lows after an upward revision of the US Q4 GDP data by the Bureau of Economic Analysis. The pair’s decline started in the late Asian session as the greenback gained ground against the euro despite the positive German GfK consumer confidence print for March.

The EUR/USD currency pair lost over 80 points to decline from a high of 1.2421 in the Asian session to a low of 1.2335 in the early American session.

The pair’s decline was triggered by market fears of declining inflation in the euro area coupled with the decline of the German 10-year bond yields to their lowest level in two months. The German GfK consumer confidence print, which came in at 10.9 versus the expected 10.7 could not reverse the euro’s initial decline. The empty European dockets meant that the euro was largely susceptible to the risk-on investor sentiment, which boosted the greenback across the board.

News that North Korean leader Kim Jong-un was open to the denuclearization of the Korean peninsula boosted the positive sentiment around the greenback. The upward revision of the US final Q4 GDP print by the BEA was the final trigger behind the currency pair’s decline. The weak advance goods trade balance report released by the Census Bureau had a muted impact on the pair.

The currency pair’s future performance is likely to be affected by tomorrow’s German unemployment data and the US PCE and jobless claims reports.

The EUR/USD currency pair was trading at 1.2344 as at 16:19 GMT having declined from a high of 1.2421. The EUR/JPY currency pair was trading at 131.36 having rallied from a low of 130.59 earlier today.

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