Forex Blog

First-hand Forex trading experience and information about foreign exchange market that will be useful to traders


EUR/USD Slumps as ECB Plans to Keep Rates Low

September 5, 2013 by

EUR/USD sank today after European Central Bank President Mario Draghi reiterated pledge to keep interest rates low for “an extended period”. (Event B on the chart.) The ECB kept its main interest rate unchanged at 0.5% at today’s meeting. US economic data continues to be good. The employment reports were positive too, leading to speculations that tomorrow’s nonfarm payrolls will demonstrate strong growth. Such talks made the currency pair even weaker.

ADP employment rose by 176k in August, matching forecasts. The July’s growth was at 198k. (Event A on the chart.)

Initial jobless claims slipped from 332k to 323k last week on a seasonally adjusted basis, while analysts have expected them to stay unchanged. (Event B on the chart.)

Nonfarm productivity increased at the 2.3% annual rate during the second quarter of 2013, beating the forecast of 1.6% and the previous value of 0.9%. (Event B on the chart.)

ISM services PMI jumped from 56.0% in July to 58.6% in August. It was a pleasant surprise for traders who have expected a drop to 55.2%. (Event C on the chart.)

Factory orders declined 2.4% in July. The reading was worse than the June’s increase by 1.6%, but better than the expected drop by 3.4%. (Event C on the chart.)

Crude oil inventories decreased by 1.8 million barrels last week, in line with analysts’ predictions, after increasing by 3 million in the previous week. Total motor gasoline inventories decreased by 1.8 million barrels. (Event D on the chart.)

Yesterday, a report on trade balance was released, showing a deficit of $39.1 billion, up from $34.5 billion in June, in line with forecasts. (Not show on the chart.)

EUR/USD for 2013-09-05

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

Leave a Reply

required (will not be published)