Euro Rallies Higher Against a Weakening US Dollar, Later Declines

The euro today rallied against the US dollar during the European session after the release of the final Eurozone CPI data. The euro was on a downtrend against the greenback during the Asian session following the risk-on sentiment in the global markets, which later resumed in the early American session.

The EUR/USD currency pair today rallied by over 50 points from a daily low of 1.2341 to hit a high of 1.2397 in the early American session.

The currency pair began today’s session on a subdued downtrend, but turned higher after the release of the Eurozone final CPI data by Eurostat. The final EMU CPI print was downgraded to an annualized 1.3% in March, which was slightly lower than the preliminary reading of 1.4%. The core CPI print expanded in line with expectations by coming in at an annualized 1.0%. The headline CPI also rose by 1.0% on a monthly basis, which was in line with expectations. The Eurozone construction output contracted by 0.5% in February coming in at an annualized 0.4%.

The US dollar was under selling pressure during the European session as tracked by the US Dollar Index, which hit a low of 89.45. The greenback recovered briefly during the early American session causing the currency pair to decline. William Dudley‘s speech and the MBA mortgage applications data up to April 13 had a muted impact on the currency pair.

The currency pair’s future performance is likely to be affected by the release of the US Federal Reserve’s Beige Book later today, and tomorrow’s jobless claims data.

The EUR/USD currency pair was trading at 1.2372 as at 15:46 GMT having dropped from a session high of 1.2397. The EUR/JPY currency pair was trading at 132.73 having rallied from a low of 132.35.

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