A batch of euro-zone and German data came out as expected and was generally positive, with advances on all fronts.
However, EUR/USD remains on the back foot as the markets continue digesting the Fed decision.
German unemployment change dropped by 9K, exactly as expected. The unemployment rate remained at 6.5% also as predicted. The number of unemployed in the continent’s largest economy after -27K in the previous month. Germany has seen a big drop in unemployment of late.
EUR/USD traded just under 1.13 before the publication and remains there afterwards.
The euro-zone M3 money supply was expected to continue accelerating with 3.6% y/y after 3.1% beforehand. Private loans were predicted to contract at a slower pace: 0.5% instead of 0.9% beforehand. No surprises were recorded here. It seems that the ECB’s easing measures are making it to the markets.
EUR/USD had a late reaction to the Fed decision: Yellen and her colleagues made no material changes and left markets speculating about the timing of the rate hike. They did not go dovish like so many other central banks.
The FOMC voted unanimously on a statement to remain patient on rate hikes and also on a cautiously optimistic view of the US economy. Tomorrow we get US GDP data for Q4.
And later today, we received the preliminary inflation figures from Germany.
The pair eventually slipped around 1.1330 to under 1.13.
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