Dollar Falls on Trade Balace and Budget Deficit Decrease

EUR/USD soared to the new highs near 1.5885 after the data on exports and imports was released in U.S. today. And, although the indicators came out better than expected, the dollar dropped at a very fast pace against all major Forex currencies.

Import (excluding oil) and export (excluding agricultural) prices both grew by 0.9% in June. This growth followed 0.7% (revised up from 0.5%) and 0.3% (revised down from 0.4%) growth in May for import and export prices respectively.

Trade balance deficit unexpectedly narrowed in May. It decreased from $60.5 billion (revised down from $60.9 billion) to $59.8 billion as the exports rose faster than the imports.

The University of Michigan consumer sentiment index showed a slight increase from 56.4 to 56.6 in the preliminary report for July, while analysts expected a decrease to 55.8 this month.

Treasury budget deficit declined in June and the monthly surplus rose to $50.7 billion from the year before ($27.5 billion). Markets expected the surplus to grow to $33 billion in June.

Read More......

Dollar Got Pushed Up by Today’s Fundamental Reports

The EUR/USD currency pair sunk down below the yesterday’s close level as the U.S. dollar continued its growth today after some good fundamental reports were released in the United States. Both retail sales and business inventories fulfilled the dollar bulls’ expectations today.

Import and export prices rose in May by 2.3% and 0.3% respectively. That growth followed 2.4% and 0.5% values that were seen a month before.

Initial jobless claims was the one disappointing indicator released today. They rose from 359k to 384k last week, while a growth to 370k was forecasted.

Retail sales report dominated the fundamental trading today. It showed the 1.0% increase for May which was above the consensus 0.5% growth and 0.4% growth in April.

Business inventories added 0.5% in April — a little more than 0.2% a month before and 0.3% average forecast for April.

Read More......