The EUR/USD currency pair today hit new multi-month lows, which were last witnessed in July, after the release of positive US GDP data in the early North American session. The pair’s massive decline began yesterday after the European Central Bank cut its quantitative easing program by half, while painting a dovish outlook for the Eurozone.
The EUR/USD currency pair today declined by over 60 point from its daily high to trade below the crucial 1.1600 resistance level. The pair last recorded such lows on July 20.
The currency pair traded in a sideways range before heading lower early in the European session. The release of the German Import Price Index by the Federal Statistical Office, which came in at an annualized 3.0% in September, beating market expectations could not boost the euro. The release of the ECB’s survey of professional forecasters also could not lift the pair. Catalonia’s unilateral declaration of independence also weighed heavily on the euro.
The release of the positive US GDP data for the third quarter by the Bureau of Economic Analysis triggered a major decline in the pair. The GDP came in at an annualized 3.0%, which beat the market consensus of 2.6% growth. The greenback’s recovery as tracked by the US Dollar Index, which hit a high of 95.15, also contributed to the pair’s decline. The University of Michigan Consumer Sentiment Index also came in above expectations boosting the greenback.
The release of German CPI data and US PCE data on Monday is likely to influence the pair’s future performance.
The EUR/USD currency pair was trading at 1.1580 as at 16:13 GMT having declined from a daily high of 1.1643 earlier today. The EUR/JPY currency pair was trading at 131.92 having dropped from a high of 132.94.
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