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16 May 2013
Forex Flash: US data was poor but poorer EU data drives USD higher - Societe Generale
FXstreet.com (Barcelona) - Olivier Korber, FX Strategist at Societe Generale notes that the tenor of US economics data yesterday was poor, with both the NY Empire manufacturing survey and industrial production growth surprising to the downside.
As a result he notes that the US 10-yr yield retreated from an intraday high above 1.98%, but poorer French, German and overall Euro area GDP growth figures powered the US dollar higher. He writes, “FX is a relative value instrument, so EUR/USD broke clear below the recent one month trading range. An upbeat assessment on an imminent UK economic recovery by Governor Mervyn King in his BOE Inflation Report swansong supported GBP on the day.”
As a result he notes that the US 10-yr yield retreated from an intraday high above 1.98%, but poorer French, German and overall Euro area GDP growth figures powered the US dollar higher. He writes, “FX is a relative value instrument, so EUR/USD broke clear below the recent one month trading range. An upbeat assessment on an imminent UK economic recovery by Governor Mervyn King in his BOE Inflation Report swansong supported GBP on the day.”