EUR/USD Climbs After ECB Policy Meeting, US Jobless Claims

EUR/USD jumped today after the European Central Bank signaled in a statement accompanying the monetary policy meeting that the central bank does not target the exchange rate, meaning that it will not prevent appreciation of the euro. (Event A on the chart.) The worse-than-expected US jobless claims also helped the currency pair. Currently, the EUR/USD pair gave away a large chunk of its gains but continues to trade above the opening level.

PPI rose by 0.3% in August on a seasonally adjusted basis. That is compared with the forecast increase of 0.2% and the previous month’s gain of 0.6%. (Event A on the chart.)

Initial jobless claims were at 884k last week, seasonally adjusted, unchanged from the previous week’s revised level. That was a surprise to analysts who were expecting a decrease to 838k. (Event A on the chart.)

Wholesale inventories shrank by 0.3% in July, whereas market participants were expecting the same 0.1% decrease as in the previous month. (Event B on the chart.)

US crude oil inventories expanded by 2.0 million barrels last week instead of falling by 3.1 million as experts had predicted. The stockpiles tumbled by 9.4 million barrels the week before. Total motor gasoline inventories dropped by 3.0 million barrels. (Event C on the chart.)

On Tuesday, a report on consumer credit was released, showing an increase of $12.3 billion in July, which trailed the median forecast of a $12.9 billion increase slightly. June’s gain got a significant positive revision from $9.0 billion to $11.4 billion. (Not shown on the chart.)

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Posted on Forex blog.