THE TAKEAWAY: Italian GDP contracts 0.2% in Q2, better than expected -> Italian economy reports first major Euro-zone release for the quarter -> Euro rises slightly
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Today’s Forex session has seen significant amounts of economic releases, which have left the Aussie and Kiwi as the big winners in today’s trading. A 25 basis point cut to the RBA rate target met analysts’ expectations, but it was the less dovish comments that sent AUD/USD higher over the hours following the release.
During the European trading hours, Italian gross domestic product for Q2 was reported better than expected, which was the first GDP release of the three major Euro-zone economies- Italy, France and Germany. The Italian economy contracted 0.2% over the quarter, beating expectations for a 0.4% contraction and better than the 0.6% contraction reported for Q1.
The 0.2% GDP decline in Italy was both the best quarterly GDP change in seven quarters, but also the eighth consecutive quarter of declining GDP in Italy. The GDP for the entire Euro-zone for Q2 will be released in an advanced estimate on the fourteenth of August, Euro investors are looking for an end of the six straight quarters of economic recession.
Also released in today’s session, UK manufacturing production beat expectations and temporarily sent the Pound higher. Soon after this piece is published, German factory orders for June will be announced.
The Euro saw a small and delayed reaction following the better than expected Italian GDP release. EUR/USD is trading slightly below 1.3300 at the time of this writing, and a monthly high recently set at 1.3344 may provide resistance.
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EURUSDDaily: August 6, 2013
Chart created by Benjamin Spier using Marketscope 2.0
-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to firstname.lastname@example.org .