17, January 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

Empire State Manufacturing rose sharply in January having jumped to 12.51 p. from upwards revised figure of December to 2.22 p., and reached the maximum from May 2012. The growth only to 3.75 was expected. The new orders subindex, general business conditions, supply and inventory rose most of all. New York City is the largest metropolis and an important economic center of the United States and the whole world.

On Wednesday Fed's member Evans said that the QE3 reduction looked quite reasonable, and tapering QE3 by $10 billion would be continued in January, but the U.S. economy would need the Fed's emergency support for a long time. He added that the central bank would keep rock-bottom rates for a long period even after the reaching of unemployment rate 6.5%. U.S. House of Representatives approved a bill to finance the government till September. As it is expected, the Senate will approve the bill on Saturday.

The pound fell to a more than a three-week minimum versus the dollar. The euro also traded downwards amid weaker-than-expected Real German GDP Growth data. Germany's economic growth rate slowed in 2013 to 0.4% from 0.7% the previous year, while the annual growth 0.5% was expected. Last year Germany's budget deficit was 0.1% from GDP as compared with a surplus 0.1% of GDP in 2012. A balanced budget (at the level 0.0%) was forecasted.

The Eurozone trade balance rose in November to €16.0 billion from € 14.5 billion a month earlier, that was less than expected growth to the level €16.7 billion. The Euro zone export rate declined for the first time in four months in November. The ECB representative Mersch said about possible further inflation slowing in the euro area, although he did not see the immediate threat of it.

The yen continued to weaken the second consecutive day amid stock market growth after the positive data on U.S. retail sales release.