Euro Rallies Against the Dollar Ignores Weak Eurozone GDP Data

The  euro today rallied to  new weekly highs against the  US dollar despite multiple disappointing macro reports from across the  euro area. The  weak dollar primarily drove the  EUR/USD currency pair’s rally as  US Treasury yields fell dragging the  greenback lower.
The  EUR/USD currency pair today rallied from a  low of  1.1017 in  the  early European session to  a  high of  1.1067 in  the  American session and  was headed higher at  the  time of  writing.
The  currency pair headed lower during the  Asian session driven by  the  risk-averse market sentiment but turned higher in  the  European session. The  release of  disappointing German retail sales data for  December by  the  Federal Statistical Office had a  muted impact on  the  currency pair. German retail sales contracted by  3.3% missing expectations of  a  0.5% decline by  a  wide margin. The  pair kept rallying despite the  flash Italian Q4 GDP report released by  Istat missing expectations by  0.1%. The  single currency extended its gains despite the  release of  weak eurozone preliminary GDP report by  Eurostat, which also missed expectations by  0.1%. The  disappointing eurozone flash inflation data for  January also had a  muted impact on  the  currency pair.
The  pair kept rallying after the  release of  mixed US personal consumption expenditure report by  the  Bureau of  Economic Analysis. The  weak US ISM Chicago Business Barometer, which missed expectations also boosted the  pair. The  fiber fell slightly on  the  upbeat UoM consumer sentiment survey for  January.
The  currency pair’s performance is likely to  be driven by  geopolitical events over the  upcoming weekend.
The  EUR/USD currency pair was trading at  1.1059 as  at  15:24 GMT having rallied from a  low of  1.1017. The  EUR/JPY currency pair was trading at  120.23 having risen from a  low of  120.08.

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