While the Euro was enjoying a fairly steady trading session following the publication of industrial production data for the Eurozone, the common currency declined against the US Dollar shortly after the North American session opened and US retail sales figures were published.
Last week a disappointing US non-farm payrolls report added to the case for the Federal Reserve refraining from continuing with its tapering policy stance and inspired widespread ‘Greenback’ declines.
Today the US Dollar was able to recover some of those losses as retail sales figures for the world’s largest economy came in above estimate.
Sales climbed by 0.2 per cent in December, month-on-month, following a negatively revised advance of 0.4 per cent in November.
Economists had expected sales to increase by 0.1 per cent.
Whilst this wasn’t a spectacular surge in spending it is an improvement.
Sales less autos increased by 0.7 per cent rather than gaining 0.4 per cent as forecast, the best result in nearly a year.
The US sales data led to this comment from economist Scott Brown; ‘There is the hope that the momentum is going to continue and the good news will feed on itself. Better spending will lead to more jobs and more jobs will lead to more spending.’
As well as rallying against the Euro the US Dollar extended an already notable gain against the Yen, jumping by the most for a month.
Earlier today a report showed a 1.8 per cent month-on-month climb in industrial production in the Eurozone.
Tomorrow EUR/USD volatility is likely to occur in response to several influential data releases, including German GDP, Eurozone trade balance and US mortgage applications. The publication of the US Federal Reserve beige book at 19:00 GMT on Wednesday will also be of interest.
Euro (EUR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,
,US Dollar,1.3676,
Euro,,British Pound,0.8317 ,
Euro,,Australian Dollar,1.5194,
Euro,,New Zealand Dollar,1.6255 ,
Euro,,Canadian Dollar,1.4885 ,
[/table]
