EUR rises higher. Overview for 16.05.2024

The primary currency pair remains in positive territory on Thursday. The current EURUSD exchange rate stands at 1.0885.

The US dollar experienced a decline, and risk appetite surged immediately after the release of the latest US inflation and retail sales reports. In April, the core consumer price index dropped to 3.6% y/y from 3.8%, and the overall index decreased to 3.4% y/y from 3.5%, marking a significant achievement.

April retail sales, which remained flat after a 0.7% increase in March, were considerably weaker than expected. This data is crucial as it effectively demonstrates current consumer behaviour. It is like watching a movie and being more interested in supporting actors as they are directly related to the main intrigue. Retail sales determine price behaviour across all sectors. If this indicator drops, the related sectors are also expected to contract.

While the released statistical data is unlikely to make an indelible impression on the Federal Reserve, it will certainly give cause for thought. According to CME FedWatch monitor data, the likelihood of an interest rate cut in September has increased.

Today, the market will continue to monitor the April statistics, focusing on weekly jobless claims, industrial production, and new home sales.