EUR recovered from losses. Overview for 16.02.2024

The primary currency pair is neutral on Friday. The current EURUSD exchange rate stands at 1.0761.

Yesterday's US statistics came out mixed. The general conclusion drawn by investors implies a potential Fed interest rate cut in May due to certain weak macroeconomic parameters.

US retail sales in January dropped by 0.8% m/m instead of the expected 0.2%. In December, the indicator rose by 0.6%. Clearly, the main reason for these changes is the cooling of consumer demand after Christmas. In this sense, the February report will reveal, but the market cannot wait and is reacting immediately.

Industrial production in January decreased by 0.1% m/m, contrary to the expected increase of 0.2%. In December, the indicator increased by 0.1%. What is vital to note with production is the preceding high base effect and local cooling of interest at the beginning of the year.

The ECB’s monetary policymakers believe that delaying the decision on an interest rate decrease is unwise. Yesterday, Francois Villeroy de Galhau, a member of the European Central Bank and Governor of the Bank of France, mentioned that actions should be taken gradually and pragmatically. He suggested that the decision should be made sooner than later; otherwise, much effort will be needed to adapt to the conditions.

The EUR reacted to these comments by rising.