Euro Rallies Against the Dollar on In-Line Eurozone Q2 GDP Data

The  euro today edged higher against the  dollar after an  initial slump as  investors remained concerned about the  political stalemate in  the  US regarding further stimulus. The  EUR/USD currency pair rallied higher as  the  greenback headed lower and  investor sentiment shifted in  favour of  the  riskier single currency, but gains were limited.
The  EUR/USD currency pair today fell to  a  low of  1.1781, which is a  medium-term resistance level, before rallying to  a  high of  1.1850 and  was near these highs at  the  time of  writing.
The  currency pair headed lower earlier today pulling back after rallying higher for  three consecutive days as  traders took profits. The  pair’s decline was also fueled by  weak greenback as  tracked by  the  US Dollar Index. The  single currency kept falling despite the  release of  the  preliminary eurozone Q2 GDP report, which contracted 12.1% translating into an  annualised 15% decline as  expected. The  upbeat eurozone trade balance report for  June released by  Eurostat also had a  muted impact on  the  pair despite being better than expected; the  print came in  at â‚¬21.2 billion versus consensus estimates of â‚¬12.6 billion.
The  currency pair reversed and  headed higher despite the  release of  US retail sales data for  June. According to  the Census Bureau, US retail sales rose 1.2% versus analysts estimates of  1.9%. The  upbeat University of  Michigan consumer sentiment survey helped limit the  pair’s gains.
The  currency pair’s performance over the  upcoming weekend is likely to  be affected by  geopolitical events.
The EUR/USD currency pair was trading at 1.1835 as at 18:07 GMT, having rallied from a low of 1.1781. The EUR/JPY currency pair was trading at 126.17, having risen from a high of 125.74.
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