US Dollar Charges to Fresh Highs on Strong GDP Data
- US GDP headling reading beats analyst estimates by 0.5%.
- US Personal Consumption ticks up to 2.2%.
- EURUSD falls to 1.2402 before finding support.
US GDP exceeded market expectations with a headline reading of 3.9% versus analyst estimates of 3.3%. According to the Bloomberg Technical Note provided at the release, the upward revision is a reflection of an increase in inventory investment, consumer spending and nonresidential fixed investment. This increase in US GDP may continue to add to dollar strength and US economic confidence during a period of global divergence in central bank policy.
US Personal Consumption data headlined at 2.2% beating analyst estimates of 1.9%. An uptick in Personal Consumption annotates a steadily increasing consumer confidence and could bode well for US retail performance in Q4 of 2014.
Here’s a summary of the data this morning that’s responsible for US Dollar price action:
- USD GDP Annualized (3Q S): 3.9% versus 3.3% expected, from 3.5% (q/q).
- USD Personal consumption (3Q S): 2.2% versus 1.9% expected, from 1.8%.
- USD GDP Price Index (3Q S): 1.4% versus 1.3% expected, from 1.3%.
- USD Core PCE (3Q S): 1.4% versus 1.4% expected, from 1.4% (q/q).
EURUSD 1-minute Chart: November 25th, 2014 Intraday
Charts Created using Marketscope – prepared by Tyler Amend
EURUSD fell to a low of 1.2402 on the back of strong economic data out of the US at 13:30 GMT. The 50% retracement of the 1.2362-1.2444 rally in EURUSD at 1.2403 resisted USD strength. The pair has since retraced some of the Dollar gains and is currently trading around 1.2413 at the time of this report.
--- Written by Tyler Amend, DailyFX Research
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