Euro Rallies on Risk-On Sentiment Amid Mixed Geman Data

The  euro today rallied higher against the  much weaker US dollar largely driven by  positive market sentiment and  the  upbeat German retail sales data. The  improved market risk sentiment was supported by  investors’ optimism regarding the  2-day high level US-China trade talks, which kicked off today.
The  EUR/USD currency pair today rallied from an  opening low of  1.1403 to  a  high of  1.1448 in  the  mid-European session.
Investor optimism towards the  outcome of  the  2-day Sino-US meeting was the  main trigger behind the  pair’s initial rally at  the  start of  today’s session. The  pair also rallied higher following the  release of  the  German retail sales data for  November by  the  Federal Statistical Office in  the  early European session. The  retail sales came in  at  a  monthly 1.4% versus the  expected 0.3% print, while the  annualized print recorded a 1.1% expansion as  compared to  the  consensus estimate of  a  0.9% contraction. The  German factory orders data missed expectations by  recording a  1.0% decline versus the  expected 0.5% drop. The  eurozone retail sales data released by  Eurostat also boosted the  pair by  coming in  at  0.6% in  November versus the  expected 0.1% print.
The  currency pair was also boosted by  the  weaker US dollar following Friday’s dovish comments by  the  Fed Chair Jerome Powell. President Donald Trump‘s recent optimism towards the  US-China trade talks boosted the  markets risk sentiment, which favors the  euro.
The  pair’s future performance is likely to  be affected by  the  release of  the  US ISM Non-manufacturing PMI later today.
The  EUR/USD currency pair was trading at  1.1437 as  at  11:39 GMT having rallied from a  low of  1.1403. The  EUR/JPY currency pair was trading at  123.93 having risen from a  low of  123.42.

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