The euro today rallied to new highs against the US dollar after the European Central Bank released the minutes of its last meeting. The single currency rallied much higher during the early North American session after the release of weak US macro data.
The EUR/USD currency pair gained over 100 points to rally from a low of 1.1928 hit in the early European session to reach a high of 1.2060 in the early American session.
The release of the ECB’s account of monetary policy meeting in the mid-European session was the main driver behind the euro’s rally. The minutes indicated that the ECB was considering a gradual shift in monetary policy this year with members expressing confidence that inflation would pick up. The release of the Eurozone industrial production data for November by Eurostat, which came in at 3.2% on an annualized basis, versus the expected 3.1% print, had minimal impact on the single currency. The release of German GDP data for 2017 by the Federal Statistical Office also contributed to the pair’s initial decline as it came in at 2.2% versus the expected 2.3% growth.
The release of the US producer price index for December also contributed to the pair’s rally as the PPI plunged to lows last seen in August 2016. The initial jobless claims data released by the Department of Labor also fueled the rally as the claims came in at 261,000 versus the expected 245,000.
The currency pair’s future performance is likely to be affected by tomorrow’s US CPI and retail sales data.
The EUR/USD currency pair was trading at 1.2043 as at 15:37 GMT having rallied from a low of 1.1928. The EUR/JPY currency pair was trading at 134.12 having rallied from a low of 133.23.
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