The US economic data reports released recently were incredibly awesome. They were above expectations and this led to a rally of the dollar. On the other hand, the euro went down as the traders were eagerly waiting for the monetary policy decision of the European Central Bank.
Generally, the US economic data asserts that the economy is moving towards a relative momentum this year. As of today, the US dollar is seen to overtake its currency competitors especially due to the increased private payrolls.
- Construction and manufacturing spending. According to the US economic data, construction spending rose up to 15% which is 3 times from the predicted 0.5%. This impacted positively on how the US dollar gained on Euro.
- Consumer spending. The dollar advanced against the euro since the consumer spending and personal income rose with 0.3% in November 2015. The US core consumer spending rose 2.0% hence marking the highest dollar gain on euro since May 2014. Basically, consumer sentiment indicated a risk.
- Euro inflation. The unexpected euro inflation was 0.2% in February 2016. Oil weak prices have contributed to the hitting ground of euro. This lead to the US dollar rallying to its highest heights against the euro.
- Home sales. Thanks to the US defense orders as they led to high home sales which increased with 2.5% in January this year.
- Employment rates. The same US economic data indicates that private employers added up to 214,000 jobs in February 2016. This was not among any of the economist’s expectations and it led to the dollar gain being against the euro. In return this has rejuvenated the expectations of at least one U.S. Federal Reserve rate hike this year after market obstacles forced them to slow down at the beginning of year 2016.
With the current vibrant US economy the dollar is expected to be against many currencies among them the euro. After peaking at $1.1375 on February this year, the euro has been losing ground.