The euro rallied higher against its main peers after the release of better-than-expected consumer confidence data by the European Commission. The currency also rallied hogher after the release of the Eurozone construction industry data for February, which beat expectations.
The EUR/USD currency pair started the day’s session on a steady rising trend for several hours before retracing some of its gains, then later rallying higher and then retracing some of its gains.
The euro rallied against its peers as the market reacted to the Eurozone consumer confidence data, which came in at -3.6 versus the expected -4.8, and the previous -5.0. The positive data follows the release of the Eurozone’s construction output for February, which was recorded at 6.9% versus the previous figure of -2.4%. The positive data from the Eurozone bolstered the euro against other major currencies.
Data released by Eurostat on Wednesday indicated that annualized inflation figures for March in the Eurozone had declined to 1.5% as opposed to 2.0% in February. This indicates that economic conditions in the Eurozone are improving, but it is highly unlikely that the European Central Bank will change its dovish policies. Comments from Peter Praet, the ECB’s Chief Economist, indicated that the bank has a cautious long-term outlook.
The upcoming French presidential election is likely to influence the future performance of the euro as the race is quite open among the four leading candidates.
The EUR/USD was trading at 1.0745 as at 16:56 GMT having retraced some of its gains from a daily high of 1.0776. The EUR/JPY was trading at 117.49 having opened the day’s session trading at 116.59.
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