Strong US Data Do Little To Impact EUR/USD

The EUR/USD pair is extending on earlier session gains and has now persuasively cleared its earlier weekly highs around 1.1304 and is pressing on into the 1.1320s.

Despite a broadly subdued tone to trade in other asset categories, like shares and bonds, currency markets have adopted a somewhat more risk-on posture on Wednesday, though most major G10 pairs have not broken out of recent intra-day/week ranges.

This observation typically applies on the EUR/USD too, though the pair is at weekly highs and now up about 0.3% on the day, it still trades well below last week’s 1.1360ish highs.

The pair continues to trade within the 1.1240-1.1360 trading range that has prevailed throughout the month thus far.

Investors and traders seeking to play the range would likely see any push towards the upper 1.1300 as an opportunity to add tentative short positions and ride the pair back under the 1.1300 handle.


Just as hawkish language from ECB members in the Wednesday European morning (Peter Kazimir warned of upside inflation risks whilst Robert Holzmann outlined his “extreme” scenario for rate hikes in 2022) failed to impact markets.

US data releases were of the same level of impact. The final estimate for US Q3 GDP was better than expected and revised higher to 2.3% form 2.1%. The headline Conference Board Consumer Confidence index rose more than expected to 115.8 in December from 109.5, its highest levels since July.

The GDP figures were ignored likely because, at this point, they are very backward-looking. Though it was nice to see US Consumer Confidence rise in December, any improvement is likely to be short-lived, with a wave of Omicron infections and associated higher levels of “pandemic fear” likely to weigh in January.