Yesterday's data on the American economy, where, on the one hand, there was a decline in retail sales, and on the other, a steady increase in manufacturing activity, was interpreted differently by traders, which led to a slight strengthening of the US dollar. However, the downward trend for the EURUSD pair has not yet received a continuation.
According to a report by the US Department of Commerce, consumer activity in the US in February of this year has declined significantly. Thus, retail sales fell immediately by 0.2% compared with the previous month, while economists had expected growth rates of 0.2%. If we do not take volatile prices for cars and gasoline, then retail sales in February fell immediately by 0.6%.
Let me remind you that in January, according to the revised data, retail sales increased by 0.7%.
The report also said that the main decline was observed in sales of furniture, electronic equipment, clothing, and food.
The PMI for the US manufacturing industry, released in the afternoon, provided some support for the US dollar, as it was better than economists had expected.
According to the report of the Institute for Supply Management, the PMI index for the manufacturing sector in March of this year rose to 55.3 points against 54.2 points in February. An index value above 50 points indicates an increase in activity. Economists had forecast a more moderate growth, to the level of 54.4 points.
The main increase was observed in the price index, which in March returned above 50 points and amounted to 54.3 points against 49.4 in February. The employment index in March rose to 57.5 points versus 52.3.
As for the technical picture of the EURUSD pair, the market remains on the side of euro sellers. The consolidation below the lower boundary of the side channel in the area of 1.1210 indicates that the pressure remains, which can lead to a new wave of decline in risky assets in the area of minimum 1.1170 and 1.1120. If buyers return to the market, it is unlikely they will be able to easily break through above the maximum of 1.1250 and 1.1300.
The British pound rose after a good report on manufacturing activity, but fell sharply at the end of the North American session, after it became known that the British Parliament rejected several alternative scenarios for Brexit.
According to the data, the PMI Purchasing Managers Index for the UK manufacturing sector rose to 55.1 points in March, while it was projected at 50.9 points. In February, this index was 52.1 points.
The material has been provided by InstaForex Company - www.instaforex.com