For the 24 hours to 23:00 GMT, the EUR rose 0.63% against the USD and closed at 1.1469 on Friday.
On the data front, the Euro-zone’s seasonally adjusted trade surplus widened less-than-expected to a level of €19.7 billion in May, following a revised surplus of €18.6 billion in the previous month, while markets were anticipating the region’s trade surplus to expand to a level of €20.2 billion.
The greenback lost ground against its major counterparts on Friday, on the back of disappointing US inflation and retail sales data that fuelled fresh doubts over the Federal Reserve’s (Fed) ability to increase interest rates for a third time this year.
Data indicated that the US consumer price index (CPI) remained flat on a monthly basis in June, compared to market expectations for a rise of 0.1% and following a drop of 0.1% in the previous month. Meanwhile, on an annual basis, the CPI climbed less-than-expected by 1.6% in June, posting its smallest gain since October 2016. In the previous month, the CPI had gained 1.9%, while investors had envisaged for an advance of 1.7%. Additionally, the nation’s advance retail sales unexpectedly dropped 0.2% on a monthly basis in June, declining for a second straight month and defying market consensus for a rise of 0.1%. In the prior month, advance retail sales had fallen by a revised 0.1%. Further, the nation’s preliminary Reuters/Michigan consumer sentiment index fell to a 9-month low level of 93.1 in July, surpassing market expectation for a drop to a level of 95.0, as consumers lost confidence in faster growth prospects in the US under the Trump administration. The index had registered a reading of 95.1 in the prior month.
Another set of economic data revealed that the US industrial production rose 0.4% on a monthly basis in June, topping market expectations for an advance of 0.3%. In the prior month, industrial production had risen by a revised 0.1%. Also, the nation’s manufacturing production rebounded 0.2% MoM in June, at par with market expectations and after recording a drop of 0.4% in the prior month. Moreover, the nation’s business inventories rose 0.3% in May, meeting market expectations. Business inventories had dropped 0.2% in the prior month.
In the Asian session, at GMT0300, the pair is trading at 1.1463, with the EUR trading a tad lower against the USD from Friday’s close.
The pair is expected to find support at 1.1418, and a fall through could take it to the next support level of 1.1372. The pair is expected to find its first resistance at 1.1492, and a rise through could take it to the next resistance level of 1.1520.
Going ahead, traders will look forward to the Euro-zone’s final consumer price index data for June and the German Bundesbank monthly report, both slated to release in a few hours. Additionally, the US New York Empire State Manufacturing index for July, scheduled to release later today, will be on investors’ radar.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.