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EUR/USD Flat as US Politics Diminish Impact of Good Economic Reports

October 31, 2017 by

EUR/USD traded almost flat on Tuesday as the Federal Open Market Committee started its two-day policy meeting. Economic reports released in the United States over the day were universally good, but that did not result in a rally of the dollar versus the euro. One of possible reasons for that were political tensions in the United States. Another one was concerns that the most likely candidate for the Federal Reserve Chair post Jerome Powell is more dovish than some other potential candidates.

S&P/Case-Shiller home price index rose 5.9% in August from the same month a year ago, while analysts expected the same 5.8% growth rate as in July. Month-on-month, the index was up 0.4%. (Event A on the chart.)

Chicago PMI climbed from 65.2 in September to 66.2 in October instead of dropping to 60.2 as analysts had predicted.

Consumer confidence jumped from 120.6 in September (upwardly revised from 119.8) to 125.9 in October, far above the forecast value of 121.1. (Event B on the chart.)

Yesterday, a report on personal income and spending was released, showing that both indicators rose in September. Income was up 0.4%, exactly as analysts had predicted, after rising 0.2% in August. Spending increased by 0.8%, compared to the medium forecast of 0.8% and the previous month’s increase of 0.1%. (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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