Euro Declines on Weak German CPI and US GDP Data, Later Recovers

The euro today retraced most of its gains against the US dollar following the release of German CPI data in the mid-European session. The EUR/USD currency pair headed lower after several releases from the US docket such as the initial jobless claims data did not meet expectations.
The EUR/USD currency pair today rallied from a low of 1.1526 to a high of 1.1600 before heading lower following the German and US releases.
The currency pair rallied higher in the early European session following the release of the positive German GfK consumer confidence data, which came in at 10.7 as compared to the expected 10.6 print. The release of the Eurozone economic sentiment indicator also boosted the pair by coming in at 112.3 versus the expected 112. The Eurozone business climate indicator missed expectations by a slight margin as it was recorded at 1.39 versus the consensus estimate of 1.4, but had a muted impact on the currency pair. The European Central Bank also published its Economic Bulletin today. .
The pair headed lower after the release of the preliminary German CPI data for June by the Federal Statistical Office, which came in at a monthly 0.1% and an annualized 2.1%, with both prints missing estimates by 0.1%. The US Q1 GDP estimate released by the Bureau of Economic Analysis also missed expectations, which weakened the greenback.
The currency pair’s future performance is likely to be affected by tomorrow’s German employment change data and US PCE data.
The EUR/USD currency pair was trading at 1.1588 as at 14:09 GMT having rallied from an initial low of 1.1526. The EUR/JPY currency pair was trading at 127.80 having risen from a low of 127.12.

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