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EUR/USD Drops on US Data, Fed Policy Outlook

March 15, 2018 by

EUR/USD dropped for the second day today, basically erasing gains caused by the previous two-day rally. One of the reasons for the drop was good US data. Another one was the fact that traders considered an interest rate hike from the Federal Reserve next week almost guaranteed.

NY Empire State Index jumped from 13.1 to 22.5 in March, far above the projected figure of 14.9. (Event A on the chart.)

Philadelphia Fed manufacturing index dropped from 25.8 in February to 22.3 in March. That was a worse reading that 23.1 predicted by analysts. (Event A on the chart.)

Initial jobless claims fell from 230k to 226k last week, in line with market expectations. (Event A on the chart.)

Import and export prices rose last month. Import prices increased 0.4%, exceeding the median forecast of a 0.3% growth. The January gain was revised from 1.0% down to 0.8%. Export prices rose 0.2% in February after also rising 0.8% in January. (Event A on the chart.)

Net foreign purchases were at $62.1 billion in January, exceeding market expectations of $35.9 billion. The December value was revise down from $27.3 billion to $23.3 billion. (Event B on the chart.)

If you have any comments on the recent EUR/USD action, please reply using the form below.

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