EUR/USD (a 4-hour chart)
The US dollar traded slightly lower to most major currencies amid the weak macrostatistic data in the USA. The data on consumer confidence and personal income indices were worse than it was expected. The Canadian dollar continued to grow for a third day against amid the Canada’s GDP data that had exceeded expectations. The Swiss franc strengthened against a background of the growth of the consumer activity indicator in Switzerland from UBS.
The Euro tested the level 1.37 to the dollar two days on end. Meanwhile the consumer confidence index in Italy fell in December to a six-month minimum 96,2 p. compared to 98,2 p. in November, while the growth rate was expected. The pound strengthened after the representative of the Bank of England Andrew Bailey had said that the Central Bank could take action to prevent ramping up sharp house prices in the UK.
The President of the Federal Reserve Bank of Richmond Jeffrey Lacker said on Monday that interest rates might be heightened early in 2015, although this term was not exhaustive.
Meanwhile the International Monetary Fund (IMF) declared readiness to improve the forecast for the economic growth in 2014, having referred to the economic growth in the United States, which would lead to further improvement of the business climate. The IMF will release an updated forecast for the USA in January.
Personal income of Americans grew in November by 0.2% in comparison with the previous month, which was significantly worse than the expected growth be 0.4%. Personal spending grew by 0.5% m/m that coincided with the expectations. The modest revenue growth may limit the future consumer spending, which are a major component of the GDP. Inflation remains subdued – the price index of personal consumption expenditures (PCE Deflator) remained unchanged in November in comparison with the previous month for the second consecutive month, while the forecasted growth was 0.1%.