The euro moved sharply higher vis-Ã -vis the U.S. dollar today as the single currency tested offers around the US$ 1.4280 level and was supported around the $1.4065 level. The common currency has been bid higher from the US$ 1.40 handle since yesterday and finished the month on a strong note, in tandem with strong gains in U.S. equity markets. Data released in the U.S. today saw the June NAPM New York current business conditions index improve to 48.3 from 44.8 in June, down sharply from 61.3 in May. Also, the Chicago ISM purchasing managers€™ index climbed to 43.4 in July from 39.9 in June. Perhaps the most important number of the day revealed U.S. gross domestic product shrank 1% in the second quarter, an improvement from -6.4% in the first quarter and -5.4% in the fourth quarter. Other data saw the Q2 employment cost index climb 0.4% q/q. Moreover, the personal consumption expenditures index climbed 1.3% in Q2, up from -1.5% in Q1, while the ex-food and energy component was up 2.0% in Q2, up from 1.1% in Q1. Federal Reserve Chairman Bernanke indicated earlier this week that the U.S. economy will begin to expand in the second half of the year. In eurozone news, it was reported EMU-16 annual consumer price inflation was off 0.6%, worse than June€™s 0.1% decline. Also, June EMU-16 unemployment rose to 9.4%, the highest level in a decade but below expectations. Euro bids are cited around the US$ 1.3900 figure.
Join the Discussion