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EUR/USD Rises as Markets Digest Powell’s Speech

August 28, 2020 by

EUR/USD rose today after closing about flat yesterday following volatile moves. The volatility was a result of a speech delivered by Federal Reserve Chairman Jerome Powell. Today’s US economic data was positive but that did not prevent the dollar from sliding against the euro.

Both personal income and spending rose in July. Personal income increased by 0.4% after falling by 1.0% in the previous month. Forecasts were way off, promising a drop of 0.3%. Personal spending climbed by 1.9% after rising by 6.2% in June (revised up from 5.6%). The median forecast promised a smaller increase of 1.5%. Core PCE price index rose by 0.3%, the same as in the preceding month but missing market expectations of a 0.5% increase. (Event A on the chart.)

Chicago PMI edged down from 51.9 in July to 51.2 in August but was slightly above the consensus forecast of 51.0. (Event B on the chart.)

Michigan Sentiment Index climbed to 74.1 in August from 72.5 in July according to the final estimate. Markets were expecting it to be unchanged from the preliminary estimate of 72.8. (Event C on the chart.)

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

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