Euro Trades Sideways on Data Divergence, Falls on Dollar Rally

Apr 02,2019 21:15   Source:Earnforex

Stacks of coins with a background of eurosThe euro today traded sideways against the US dollar amid a mixed market mood as investors weighed the data divergence between the EU and the US. The EUR/USD currency pair later broke out of its sideways range in the American session as the US dollar recovered.

The EUR/USD currency pair today traded in a range marked by a high of 1.1212 and a low of 1.1189 before briefly breaking lower.

The currency pair was under pressure from the Asian session as investors weighed the divergent data coming out of the European Union and the US dockets. The data released yesterday revealed that eurozone inflation was at an annualized 1.4% in March as opposed to the expected 1.5% print, while factory activity also missed consensus estimates. The eurozone manufacturing PMI released by IHS Markit declined for the eight month in a row to hit a record low of 47.5. However, yesterday’s US ISM Manufacturing PMI came in at 55.3 beating expectations and showing that the sector had recovered from February’s lows. The data divergence kept the currency pair trading in a tight range with a bearish bias.

The pair attempted to rally following the release of disappointing US durable goods orders by the Census Bureau in the early American session, but could not break out of the range. The pair was also weighed down by the Brexit impasse.

The pair’s future performance is likely to be affected by tomorrow’s eurozone retail sales data and US ISM non-manufacturing composite.

The EUR/USD currency pair was trading at 1.1186 as at 15:19 GMT having fallen from a high of 1.1212. The EUR/JPY currency pair was trading at 124.48 having dropped from a high of 124.88.

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