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EUR/USD Rises as US Trade Balance Deficit Exceeds Forecasts

April 12, 2011 by

EUR/USD rose today, following yesterday drop. The currency pair weakened somewhat a few hours ago, but now regained its strength. The deficit of both trade balance and federal balance decreased, even though it was still above forecasts. EUR/USD currently trades at about 1.4487.

US trade balance posted a deficit of $45.8 billion in February. The reading was worse that the average forecast of $44.1 billion deficit, even though it was better than the January value of $47.0 billion. (Event A on the chart.)

Import and export prices rose in March. Import prices rose 2.7% in March, following a 1.4% advance in February, compared to the forecast growth by 2.1%. Both fuel and nonfuel prices contributed to the increase. Export prices increased 1.5% in March after rising 1.4% the previous month. (Event A on the chart.)

Treasury budget balance posted a deficit of $188.2 billion in March, compared from the analysts’ prediction of $163.5 billion deficit. The deficit was lower than $222.5 billion in February. (Event B on the chart.)

EURUSD for 2011-04-12

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