EUR/USD Rallies on German Business Sentiment

EUR/USD jumped today after the business sentiment for Germany as well as the whole eurozone showed a surprisingly sharp improvement this month. (Event A on the chart.) But market participants question the ability of the currency pair to maintain its upward momentum for long, especially if the Federal Reserve will disappoint markets with its monetary policy announcement tomorrow.
Both industrial production and capacity utilization increased in August. Industrial production rose by 0.6%, exceeding the average forecast of a 0.2% increase. The previous month’s drop got a positive revision from 0.2% to 0.1%. Capacity utilization rose from 77.5% to 77.9%, whereas analysts were expecting it to stay about unchanged. (Event B on the chart.)
Net foreign purchases were at $84.3 billion in July. The value was smaller than $99.1 billion logged in June but bigger than $81.3 billion predicted by analysts. (Event C on the chart.)

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