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EUR/USD Trades Lower as Coronavirus Panic Persists

February 25, 2020 by

EUR/USD fell today as the coronavirus outbreak continued to cause risk aversion on markets. Today’s macroeconomic data released in the United States was disappointing for the most part but that did not help the currency pair.

S&P/Case-Shiller home price index climbed 2.9% in December, year-on-year, up from 2.5% in the previous month. Analysts had predicted a slightly slower growth of 2.8%. (Event A on the chart.)

Richmond Fed manufacturing index tumbled from 20 in January to -2 in February. That was a surprisingly bad result considering that experts had promised a much smaller drop to 10. (Event B on the chart.)

Consumer confidence rose slightly to 130.7 in February from 130.4 in January but was far below the forecast figure of 132.6. (Event B on the chart.)

On Friday, a couple of reports were released (not shown on the chart):

Markit released flash readings for manufacturing and services PMIs. Markit manufacturing PMI from 51.9 in January to 50.8 in February, far below the forecast level of 51.5. Markit services PMI tanked from 53.4 to 49.4, whereas analysts expected it to stay unchanged. A reading below 50.0 means contraction, while above means expansion.

Existing home sales fell to a seasonally adjusted annual rate of 5.46 million in January from 5.53 million in December, matching the consensus forecast exactly.

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

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