The euro strengthened as the product estimate showed numbers higher than expected for the quarter. When analysts expected the GDP to grow 2.6% annually, the real number came at 3.3%.
The market is now looking forward to the GDP reports from other major economies in the euro area, which are expected shortly. The Swiss retail sales and the British inflation data are the other key releases expected in the London session on Tuesday.
For later in the morning, various US releases have been slated for release. The consumer price index for April, Empire manufacturing survey report for the month of May, net long term TIC flows for March and NAHB housing market index for May are the US numbers, which are likely to influence the North American session on the day.
Influenced by the “strong vigilance” call by the ECB President Jean Claude Trichet, the euro has been trending higher against most major counterparts since last Friday. However, the sterling had lost ground against the euro a day before.
The euro moved sideways against the dollar in the early hours on Tuesday in New York. From a range, which was limited between 1.3541 and 1.3550, the pair weakened slightly before the German release. However, the stronger-than-expected German GDP data strengthened the pair, and moving from 1.3537, the euro collected 1.3557 dollars at about 2:35 am ET. 1.362 will be a likely upside target for the pair.
The European currency moved sideways between 0.6841 and 0.6845 against the British pound as the early morning trading on Tuesday began in New York. About half an hour before the German release, the pair started drifting lower, but amid the GDP release from Germany, euro changed its direction. However, shortly thereafter, the pair weakened again, and it was worth 0.6841 at 2:35 am ET. The pair is now challenging a near term resistance.
The euro moved down against the Japanese yen in the early hours on Tuesday in New York. Falling from 163.12, the pair traded at 162.85 at about 2:00 am ET. The German data strengthened the euro thereafter, and the pair equaled 163.03 at about 2:35 am. The pair is now testing resistance near the multi-year high hit in the last week of April.
The common currency traded sideways against the Swiss franc in the very early hours on Tuesday in New York. The pair edged up from a range, which was limited between 1.6498 and 1.6509 by about 2:00 am ET. It was the German data that helped the euro move up, and lately, the pair has been moving between 1.6501 and 1.6512. If the upside from Friday is continued, then the pair is likely to test near term resistance around 1.653.
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