U.S. Dollar Continues Falling

EUR/USD continued to rally today after four unprecedented days of growth, making it the full bullish week for this currency pair with the every trading day session ending in favor of euro. Even holidays with their low financial trading volume couldn't save USD from losing 2% against EUR.

Chicago PMI (Chicago Business Barometer) rose to astonishing 56.6 in December after being only 52.9 in November. The average forecast for this indicator was around 52.0. So, it should definitely improve current dollar's stance.

U.S. Department of Housing and Urban Development released the report on November new home sales, showing a large downward gap between the October and current values - 9%. New residential sales were at 647,000, while October's value (revised down from 728,000) was 711,000. Analysts expected a lesser drop to 715,000.

GDP Data Released in U.S. Today

EUR/USD confirmed its downtrend intentions today falling from yesterday's retracement to 1.4740 level. One of the reason for a stronger dollar can be seen in expectations for the increased real GDP growth in third quarter of 2007.

U.S. Bureau of Economic Analysis released its preliminary report on real Q3 Gross Domestic Product. The growth was higher than the previous advance value for third quarter - 4.9% against 3.8% and the same as analysts expected (that were quite optimistic with this indicator). As it was stated by Bureau, the growth was mainly caused by increased exports (thanks to a cheap dollar, I suppose).

Initial jobless claims report for the last week was opposite to GDP. In the week ending Nov. 24, the advance figure for seasonally adjusted initial jobless claims was 352k. That is 23k above the previous revised (from 330k) value of 329k and expected 330k.

New home sales disappointed dollar and U.S. stocks bulls too. Annualized and seasonally adjusted October number was just 728,000 whereas at least 750,000 were expected. And September value was also revised down from 770,000 to 716,000.

New Signs of Recession for U.S. Economy

The closer it is to the October 31st when the FOMC's meeting on interest rates policy will be held the stronger the dollar bears feel themselves on the Forex market. With almost each day bringing new reasons for the Fed to decrease interest rate again this time the decision became clear now.

Initial jobless claims for the last week decreased compared to the previous week report, but still came out worse than expected - 331k compared to 339k previous week and 320k expected.

Durable goods orders by the manufacturers, according to U.S. Census Bureau, in September decreased by $3.8 billion or 1.7%, while previous value was revised from 4.9% (also decrease) to 5.3%. Now, considering that the markets were expecting increase by 1.5%, it is possible to say that manufacturing sector is suffering or at least is going to suffer something close to a crisis.

September new home sales increased a little from August number - 770k against 735k (but August value was revised from 795k) and they were still lower than expectations. But real estate sector is already known to be in downfall. So, at least for me nothing surprising here.

Bad U.S. News Keeping EUR/USD Above 1.3700

Today EUR/USD was ranging between 1.3690 and 1.3770 marks retracing a half of the yesterday's dollar rally. U.S. economy had some bad news for dollar bulls with only one bad for Euro bulls.
Manufactured durable goods orders in June increased by only 1.4% which was much lower the expected number - 2.0%, but still better than May result of decline in 2.8%.
Initial jobless claims for the last week surprisingly came out at the 301,000 level, slightly below the 310,000 number which was predicted by financial experts. Being the only positive news for the day, job market is still doing quite well, especially comparing to realty market.
Help-wanted advertising index isn't a very influential indicator of the economy growth but its decline to 26 (its staying at 27 was expected) can be an early sign for some problems on the U.S. employment market.
New homes sales in June dropped significantly from 893K (revised from 915K) to 834K units, continuing the series of bad news from the real estate sector of economy.

Bad U.S. Data Don't Bother EUR/USD

Forex seems to be ignoring todays macroeconomic data that came from United States - dollar is almost at the same level (slightly better even) as it was when the week started, a ranging week so far. New home sales disappointed U.S. optimists by showing a decline from 981,000 to 915,000 houses for May, it is even lower than experts expected - 925,000. Consumer confidence - one of the basic indicator of economical growth declined in June compared to May - 103.9 from 108.5, while it was expected to come just a little lower - 106.0. Such bad news for U.S. doesn't add any optimism to USD bulls and can cause some further EUR/USD growth.