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Fed Stimulus Announcement & Jobless Claims Lead to Surge of EUR/USD

April 9, 2020 by

EUR/USD jumped sharply today. Initially, the currency pair was moving without any particular direction during the trading session, and the move up that has started at 11:45 GMT just looked like a usual bounce after the prior decline. But it accelerated sharply after the announcement from the Federal Reserve of $2.3 trillion in loans to support businesses and households and the release of US initial jobless claims that showed an extremely high level of unemployment caused by the COVID-19 pandemic. (Event A on the chart.)

Initial jobless claims were at the seasonally adjusted level of 6,606k last week. That is compared with the forecast value of 5,000k and the previous week’s revised reading of 6,867k (a huge revision from the initial result of 6,648k). (Event A on the chart.)

PPI fell by 0.2% in March. That was a smaller drop than 0.3% predicted by analysts and 0.6% registered in February. (Event A on the chart.)

Michigan Sentiment Index sank to 71.0 in April from 89.1 in March according to the preliminary estimate. Experts were expecting a smaller drop to 75.0. (Event B on the chart.)

Wholesale inventories fell by 0.7% in February. Specialists were expecting the same rate of drop as in the previous month. (Event B on the chart.)

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

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