The EUR/USD currency pair today rallied higher briefly after the release of negative US weekly jobless claims data by the US Department of Labor. The currency pair’s rally was also due to US dollar weakness precipitated by the disappointing US producer price index data, which was also released today, but fell short of expectations.
The EUR/USD currency pair rallied by over 40 points from its daily low after the release of the US data, but had not retraced all its daily losses at the time of writing.
The currency pair rallied higher after the release of weak unemployment weekly insurance claims data, which came in at 244,000 versus the expected 240,000 jobless claims data. However, the continuing claims beat expectations by coming in at 1.951 million as compared to the expected 1.960 million. The US PPI figures released by the Bureau of Labor Statistics also missed expectations by coming in at -0.1% for the month of July, as opposed to the market consensus of a 0.1% increase.
The euro’s recent weakness against the US dollar is largely due to the disappointing data coming out of many European Union countries recently. Most investors seem to have concluded that the weak data from the Eurozone is an indicator that the European Central Bank may not commence its tapering program in the near future.
The currency pair’s future performance is likely to be affected by the release of the German CPI data and the US CPI data, both scheduled for tomorrow.
The EUR/USD currency pair was trading at 1.1728 as at 14:25 GMT having declined from its opening price of 1.1763. The EUR/JPY was trading at 128.26 having dropped from a high of 129.55 earlier today.
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