For the 24 hours to 23:00 GMT, the EUR rose 0.56% against the USD and closed at 1.1442, after Germany’s preliminary consumer price index (CPI) advanced more-than-expected by 1.6% on an annual basis in June, suggesting that a healthy upswing in economic activity will help revive inflation in the Euro-zone’s largest economy. The CPI had risen 1.5% in the previous month, while market participants had anticipated an increase of 1.4%. Additionally, the nation’s GfK consumer confidence index strengthened to a nearly sixteen-year high level of 10.6 in July, while investors had envisaged the index to remain steady at 10.4.
Separately, the Euro-zone’s final consumer confidence index improved to a level of -1.3 in June, confirming the preliminary estimate. In the prior month, the index had registered a level of -3.3. Further, the region’s economic sentiment indicator jumped to a nine-year high level of 111.1 in June, following a level of 109.2 in the prior month.
The greenback lost ground against a basket of major currencies, as investors brushed off upbeat US gross domestic product (GDP) data.
The second estimate of annualised gross domestic product (GDP) in the US was surprisingly revised higher to 1.4% in 1Q 2017, compared to a preliminary print that had indicated an advance of 1.2%, aided by higher consumer spending and robust growth in exports. In the previous quarter, the GDP had risen 2.1%. On the other hand, the nation’s initial jobless claims recorded an unexpected increase to a level of 244.0K in the week ended 24 June, defying market consensus for it to ease to a level of 240.0K and compared to a revised reading of 242.0K in the prior week.
In the Asian session, at GMT0300, the pair is trading at 1.1442, with the EUR trading flat against the USD from yesterday’s close.
The pair is expected to find support at 1.1405, and a fall through could take it to the next support level of 1.1368. The pair is expected to find its first resistance at 1.1462, and a rise through could take it to the next resistance level of 1.1482.
Moving ahead, investors will look forward to the Euro-zone’s flash inflation numbers for June along with Germany’s unemployment rate for June and retail sales for May, all slated to release in a few hours. Additionally, the US personal income and spending for May as well as the final Michigan consumer confidence index for June, will garner a lot of market attention.
The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.
