EUR/USD Conversion Rate Making Gains in spite of Weak German Factory Orders
Despite German Factory Orders having unexpectedly slumped in December, falling on the month to -1.0%, the EUR/USD exchange rate has been on a cautious uptrend on Thursday morning. Largely this seems to be due to investor excitement over yesterday’s unexpectedly solid US data having cooled, pushing the US Dollar (USD) onto a slightly softer footing.
Earlier…
As the single currency (EUR) has retreated on the back of new developments in the Volkswagen emissions saga today the US Dollar (USD) is making gains thanks to a better-than-forecast ADP Employment Change figure.
Euro (EUR) Softens Today with Latest Volkswagen Emissions Scandal News
Volkswagen returned to the headlines this week as US regulators accused the company of having fitted ‘defeat devices’ in a number of additional car models, including Audi and Porsche vehicles. In lieu of any particularly supportive data on Tuesday this set the Euro (EUR) on a downtrend against rivals, with investors reacting badly to the prospect of further fines or recalls. The news worsened today, however, as the carmaker admitted that 800,000 vehicles recorded inaccurate carbon dioxide emissions and fuel efficiency. With Volkswagen shares slumping once again and confidence in the German industry at least somewhat tarnished the single currency extended its losses against rivals.
US Dollar Currency News: USD Bullish as Data Supports Hopes of 2015 Fed Interest Rate Hike
Speculation as to the likelihood of an interest rate rise from the Fed coming in December has continued to drive the outlook of the ‘Greenback’ (USD). Although yesterday’s domestic Factory Orders failed to improve as far as hoped, this inconclusive result was outweighed by the unexpectedly strong performance of the ISM New York Index. Surging well past forecast the index rose from 44.5 to 65.8, this indicated that business performance within the state had improved on the month and suggested that the domestic economy could be robust enough to support an imminent rate hike.
The US Dollar has been on another bullish run this afternoon on the news that the ADP Employment Change figure bettered forecasts, showing that businesses had hired 182,000 new employees in October. As traders had anticipated a slightly larger drop in employment change, this helped to shore up the currency, boding well for Friday’s more pivotal Change in Non-Farm Payrolls reading and the chances of the Federal Open Market Committee (FOMC) choosing to raise interest rates before the end of the year.
EUR/USD Exchange Rate Forecast: Euro Hoping for Rally on Eurozone Retail PMI and Sales Figures
As further news is likely to emerge in relation to this latest chapter in the Volkswagen scandal, the Euro could well remain in a persistent slump over the coming days. However, should Thursday’s Eurozone Retail PMI and Sales data show an improvement on the month the single currency could yet find a rallying point.
Upcoming US data could have a little less of an impact tomorrow, with the latest Initial and Continuing Jobless Claims figures expected to show limited change on the previous week. Volatility will be more pronounced for the EUR/USD exchange rate on Friday, though, in advance of the Change in Non-Farm Payrolls data.
Current EUR, USD Exchange Rates
At time of writing, the Euro to US Dollar (EUR/USD) exchange rate was slumped in the range of 1.0889, while the US Dollar to Euro (USD/EUR) pairing made gains in the region of 0.9182.
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