The euro today rallied higher against the US dollar buoyed by the positive investor sentiment and mostly in-line macro reports from across the euro area. The EUR/USD currency pair edged higher for the fifth consecutive session as the dollar remained on the back foot due to the looming November US Presidential elections.
The EUR/USD currency pair today rallied from an initial low of 1.1858 in the Australian session to a high of 1.1900 before retracing some of its gains and heading lower.
The pair’s initial rally was boosted by positive market sentiment after China reported improved industrial output and retail sales figures for August showing signs of a robust economic recovery. The release of the in-line French consumer price index report for August by Insee had a muted impact on the pair. The in-line Italian inflation report for August published by Istat also had a minimal effect on the currency pair, which kept falling. The upbeat German ZEW survey data for September barely moved the pair, despite both the current assessments and current situation prints beating analysts estimates.
The upbeat ZEW eurozone economic sentiment survey also contributed to the pair’s second rally. The release of the mixed US export and import price indexes by the US export and import price indexes caused the pair to give up most of its gains.
The currency pair’s future performance is likely to be affected by market sentiment and tomorrow’s FOMC rate decision,
The EUR/USD currency pair was trading at 1.1878 as at 13:06 GMT, having fallen from a high of 1.1900. The EUR/JPY currency pair was trading at 125.15, having dropped from a high of 125.77.
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