EURUSD Rises Amid Soft US Growth Data
EUR/USD rose moderately on Tuesday on a thin day of trading, as soft U.S. GDP data weighed heavily on a steadily weakening dollar.
The currency pair traded in a tight range between 1.0902 and 1.0984 before settling at 1.0954, up 0.0039 or 0.36% on the session. The euro is enjoying a modest three-day winning streak versus the dollar and is up by 0.26% against its American counterpart since the Federal Reserve raised short-term interest rates for the first time in nearly a decade last week.
More broadly, the euro is up by more than 3.20% against the dollar since the European Central Bank rattled global currency markets by only instituting limited easing measures with comprehensive asset-purchasing program at a closely-watched meeting at the start of the month. The dollar is currently down by nearly 2% against a basket of rivals in December, suffering its worst month since April.
EUR/USD likely gained support at 1.0538, the low from December 3 and was met with resistance at 1.1496, the high from Oct. 15.
On Tuesday morning, the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA) said real gross domestic product in the third quarter increased at a rate of 2.0%, down sharply from annual GDP growth of 3.9% in the second quarter of 2015.
The BEA’s third estimate released on Tuesday also fell slightly from its second estimate of 2.1% growth issued last month. Real GDP measures the value of the goods and services produced by a nation’s economy minus the goods and services used up in production, adjusted for price changes.