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EUR/USD Resumes Decline on US GDP & Housing

August 28, 2014 by

EUR/USD resumed its decline today after yesterday’s short-lived bounce as economic indicators from the United States were rather good, especially the positive GDP revision and the pending home sales figure.

Preliminary reading of US GDP showed growth by 4.2% for Q2 2014 that followed the drop by 2.1% in Q1. The actual reading was better than the predicted 3.9% and the advance estimate of 4.0%. (Event A on the chart.)

Initial jobless claims were at 298k last week, seasonally adjusted, little changed from the previous week’s 299k and in line with expectations. (Event A on the chart.)

Pending homes sales jumped 3.3% in July from June, reaching the highest level since August 2013. The figure was far higher than the forecast 0.6% and the June’s revised change of -1.3%. (Event B on the chart.)

Yesterday, a report on crude oil inventories was released, showing a decrease by 2.1 million barrels last week instead of an increase by 1.1 million that was predicted by analyst. The previous week’s drop was by 4.5 million. The inventories were in the upper half of the average range for this time of year. Total motor gasoline inventories decreased by 1.0 million barrels and were in the middle of the average range. (Not shown on the chart.)

EUR/USD for 2014-08-28

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