The EUR/USD pair jumped overnight to the highest level since Wednesday after optimism emerged from an EU summit. The pair has reached 1.1660. It was also weighed down on the US final Q1 GDP numbers that were revised slightly lower. Yesterday, the final GDP numbers showed that the economy had grown by just 2.0% which was lower than last month’s preliminary reading. In the fourth quarter, the economy had expanded by 2.9%.
The downward revision was mostly focused on lower-than expected consumer spending and the business inventory numbers.
The stability of the EU was probably the biggest problem for the EU. On Wednesday and Thursday, the region’s leaders met in Brussels to hammer out a deal. The main concern was that immigrants coming to the region had a choice on the countries they wanted to go to. Most of them had a goal of moving to Germany where opportunities were many. Germany’s coalition partners wanted this ended and, in a speech, Merkel called the migration issue a make or break for the EU. Yesterday, some progress were made, which for now reduces the risks for a break of the EU.
The EUR/USD is currently trading below the short and medium-term moving averages. Traders who were long the pair should consider taking profits as we wait for the Germany employment numbers and EU CPI numbers.