The euro today dropped against the US dollar from the start of today’s session as the greenback rebounded on investors’ hopes about the outcome of the US-China trade talks. The rebound in US Treasury yields also boosted the greenback, which was under intense selling pressure since Friday last week following dovish Fed comments.
The EUR/USD currency pair today dropped from an opening high of 1.1484 to a low of 1.1421 in the early American session.
The currency pair’s decline was precipitated by the US dollar’s rebound from yesterday’s drop, which was triggered by the release of the disappointing US ISM Non-Manufacturing PMI. The release of the German industrial production data for November drove the pair lower as the print missed expectations. According to Germany’s Federal Statistical Office, industrial production contracted by a massive 1.9% versus the expected 0.3% expansion. The release of the eurozone business climate indicator for December by the European Commission also contributed to the decline as the print came in at 0.88 as compared to the consensus estimate of 0.99.
The disappointing eurozone economic sentiment indicator, the services confidence and the industrial confidence prints all put immense downward pressure on the euro. The stronger greenback as tracked by the US Dollar Index, which hit a high of 96.03, also contributed to the pair’s decline.
The currency pair’s short-term performance is likely to be influenced by President Donald Trump‘s speech and the US consumer credit data, both due later today.
The EUR/USD currency pair was trading at 1.1435 as at 15:08 GMT having dropped from a high of 1.1484. The EUR/JPY currency pair was trading at 124.48 having declined from a high of 124.87.
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Euro Drops on Weak German Industrial Data and Strong US Dollar
