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EUR/USD Down on China Lendings, Greek Deficit

January 15, 2010 by

The EUR/USD currency pair declined considerably today as China’s lending policy is tightening, declining demand for higher-yielding options in trading markets and bringing investors to purchase dollar and yen-priced assets. The euro declined versus the greenback and the several other currencies as Greece’s financial conditions continues to deteriorate and raise concerns among traders investing in the region. EUR/USD is towards the end of this weekly trading session posting a slight decline and trading at 1.4365.

N.Y. Empire State Manufacturing index increased to 15.9 in January from a previous revised reading of 4.5 in December. Actual figures were more positive than forecasts that expected this index to be at 11.2.

Consumer Price Index (CPI) was the most important report published today and had a slight increase of 0.1% in December from a previous advance of 0.4% in November. Forecasts expected this price index to rise by 0.2%.

Industrial production and capacity utilization remained almost neutral in December compared to the previous month. While industrial production had an advance of 0.6% in December from the same revised reading in November, capacity utilization rate was at 72.0% from a previous revised reading of 71.5%. Forecasts expected industrial production to advance 0.7% and capacity rate at 72.0%.

Preliminary Michigan Consumer Sentiment was the last important report for the U.S. economy this week and rose slightly to 72.8 in January from a previous revised reading of 72.5. Forecasts expected this index to rise up to 73.8.

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

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