On Wednesday, the European shared currency prolonged its losses against the greenback, pushing the EUR/USD pair in the vicinity of 1.06. The trend tested the critical support line from 1.06 after the release of flash CPI (Consumers Price Index) figure in UE, which came under markets’ expectations with a 0.1% rise yoy (year-on-year). Core prices have also failed to meet the forecasted values, registering a 0.9% rise yoy in November, versus a 1.1% gain in October.
BoC (Bank of Canada) also announced on Wednesday its decision to go further with the same 0.5% monetary policy rate, explaining their decision through the slightly biased tone in the economy. The bank’s rate for credits now stands at 0.75% and the deposits rate at 0.5%. Yesterday was released the Q3 GDP (Gross Domestic Product), the Canadian economy showing a 2.3% growth as per expectations. Although the shiny figure, if we look mom (month-on-month) we can see a 0.5% shrinkage in the 3rd month of the quarter.
On Thursday, the ECB’s (European Central Bank) official statement after the Governing Council’s meeting explains the decision of a rate cut for the deposit facility, the monetary benchmark being decreased 10 basis points off to the -0.30% handle the changes being effective from the 9th of December.
US’s ISM (Institute of Supply Management) non-manufacturing/services index shows a higher activity drop than expected for the month of November. The index reached 55.9, the expectations having been set at 58.00 with 59.1 in October. The cause behind this steep fall is the drop in the employment sub-index, which ticked lower in November compared to October.
The EUR/USD pair continued to rise throughout yesterday’s American session, breaking the resistance line at 1.0950 and closing even higher at 1.0969, marking a new 1-month high. At the moment of writing the pair trades with 3% on the positive side, posting its biggest gains in years.
The yellow metal managed to retrace yesterday after posting losses two days in a row and also hitting fresh multi-years lows. The gains are due to the weak dollar across the board. Gold started Thursday with a fresh low at $1, 1046 per ounce and started to shifts its direction after ECB’s conference, with Draghi failing to compel to market expectations and offering more stimulus to the European currency, arousing the bulls on Euro and bears on the dollar. The futures prices for gold settled at $1,061 per ounce, registering a 0.7% gain for the day,
