Euro at one-week peak vs broadly weaker dollar

Euro at one-week peak vs broadly weaker dollar

13 May 2015, 16:33
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On Wednesday the euro reached one-week highs against the broadly weaker dollar as downbeat U.S. economic reports released earlier added to concerns over the outlook for second quarter growth after a sharp slowdown in the first quarter.

The euro was also supported after the data showed the region's economy grew at the fastest pace in four years.

EUR/USD was up 1.09% to 1.1334, re-approaching the two-month high of 1.1391 set last Thursday.

Data released earlier showed U.S. retail sales were flat in April and import prices were lower for a tenth straight month. The news sent the dollar lower.

The U.S. Commerce Department said retail sales were unchanged, compared to expectations for a 0.2% increase. March’s figure was revised up to show a 1.1% increase from 0.9%, but this was offset by underlying weakness in the report.

Core retail sales climbed just 0.1%, below forecasts for a 0.5% gain.

The U.S. Labor Department said import prices fell 0.3% last month after slipping 0.2% in March while economists had expected an increase of 0.3%.

The U.S. economy expanded just 0.2% in the first quarter. The recent data added to expectations that the Federal Reserve will delay hiking rates until later in the year.

In the euro zone, data on Wednesday showed that the economy grew 0.4% in the first quarter of 2015, below expectations for growth of 0.5% but still the fastest rate of growth in four years.

The euro area’s largest, German, rose 0.3% in the first quarter, slowing from 0.7% in the previous quarter while the French economy grew 0.6% in the first quarter, the fastest rate of growth in two years.

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