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Euro Rallies Against US Dollar on Weak PCE Data

September 29, 2017 at 13:52 by Simon Mugo

One euro coin and a chartThe euro today gained ground against the US dollar after the release of weak US Personal Consumption Expenditure data early in the North American session. The EUR/USD currency pair had rallied higher during the early European session despite the release of the flash Eurozone CPI estimate by Eurostat, which missed expectations.

The currency pair rallied by over 60 points to hit new daily highs after the release of the PCE data.

The EUR/USD pair was on an upward trend from the late Asian session and the release of mixed Eurozone data could not reverse this trend. The German retail sales for August were released first by the Federal Statistical Office, but did not meet expectations as they recorded a 2.8% growth rate instead of the expected 3.2% increase. The German unemployment rate was next, which was lower than expected as it came in at 5.6% instead of the consensus figure of 5.7%. Lastly, the Eurozone flash CPI estimate for September was released, which came in lower than expected at 1.5%, instead of 1.6%.

The currency pair rallied higher despite the release of US personal income data for August, which met expectations by coming in at 0.2%. The personal spending data for August also met expectations at 0.10%. The release of the core PCE for August by the Bureau of Economic Analysis did not meet the market consensus of 1.4% as it was recorded at 1.3%.

The currency pair’s future performance is likely to be affected by Monday’s release of Markit PMI data from the Eurozone, and ISM data from the US docket.

The EUR/USD currency pair was trading at 1.1818 as at 13:46 GMT having rallied from a low of 1.1770. The EUR/JPY pair was trading at 132.86 having rallied from a low of 132.50 earlier today.

If you have any questions, comments, or opinions regarding the Euro, feel free to post them using the commentary form below.

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