The Euro (EUR) extends losses against the Dollar (USD) for the second consecutive day on Wednesday, trading below 1.1700 at the time of writing after rejection at 1.1790 on Tuesday.
Eurozone Gross Domestic Product (GDP) and, above all, Industrial Production figures have failed to meet expectations, increasing bearish pressure on the Euro
The second estimate of the Eurozone’s GDP confirmed that the economy grew at a meager 0.1% pace in the first three months of the year, and 0.8% in the previous 12 months, down from 0.2% and 1.2%, respectively, in Q4. Beyond that, Eurozone Industrial Production figures have shown a 0.2% growth in March, below the 0.3% market forecast, and February’s figures have been revised down to 0.2% from the previously estimated 0.4% rise. Year-on-year, factory output has accelerated its contraction, to -2.1% in March, from -0.8% in the previous month.
The US Dollar, on the other hand, remains buoyed by the inflationary surprise revealed by April’s Consumer Price Index (CPI) figures, released on Tuesday. A nearly three-year high year-on-year CPI rate has crushed hopes of further Federal Reserve (Fed) rate cuts in the foreseeable future, boosting US Treasury yields and the Greenback with them. Beyond that, the stalemate in the Middle East conflict keeps providing support to the safe-haven USD, as US President Donald Trump heads to China to seek support from President Xi Jinping to untie the knot of Iran’s war.