Euro to US Dollar Exchange Rate Higher After US Data Releases

April 16, 2015 - Written by Tim Boyer

STORY LINK Euro to US Dollar Exchange Rate Higher After US Data Releases

Euro to US Dollar (EUR/USD) Exchange Rate Higher After US Data Releases

The Euro to US Dollar exchange rate advanced to its best level in a week as economic data released in the world’s largest economy came in below expectations again and heightened speculation that the Federal Reserve will not raise interest rates until late in the year rather than in June.

Data released by the Washington based Department of Labour showed that the number of American filing for initial unemployment benefits increased by 12,000 in the week ending on April 11. The rise brought the total amount of claimants up from the previous week’s figure of 282,000 to 294,000. The data disappointed economists who had been forecasting for the number of initial claimants to fall by 2,000 to 280,000. The continuous claims report however suggested that the number of long term unemployed fell as it showed that the number of people still receiving benefits after an initial week dropped by 40,000 to 2.27 million. The figure was the lowest recorded since December 2000.

Also released by the Commerce Department was data, which suggested that the US home building sector slowed in March. US housing starts were shown to have risen by 2% from the preceding month to an annually adjusted rate of 926,000. The figure was below the 15.9% rise expected by analysts.

‘The lack of significant bounce-back in the March data raises some questions about the underlying strength in the housing market since we believe the March data should have been mostly free from any negative weather impact,’ said an economist at J.P Morgan Chase.

Economic data released in the previous session was also weighing as it showed that industrial production rose by just 2% on a year on year basis in March, below expectations for a rise of 3%. On a monthly basis, production was shown to have fallen by -0.6%. Manufacturing production improved by 2.4% but was down on the preceding month’s increase of 3.4% and was below expectations for a figure of 2.5%. The Federal Reserve Bank of New York also said that its general business conditions index decreased to -1.2 this month from a reading of 6.9 in March. Analysts had expected the index to inch up to 7.0 in April.

The Euro meanwhile is forecast to come under pressure over the coming sessions as concerns over a possible Greek exit from the Eurozone increased. A number of Eurozone finance minister have said that a deal between Athens and its creditors is unlikely to happen anytime soon.

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TAGS: American Dollar Forecasts Daily Currency Updates Euro Forecasts