Breaking: US GDP meets expectations with 2.1%, USD choppy

Yohay Elam FXStreet

The US economy grew by an annualized rate of 2.1%, as broadly expected. However, personal consumption is only at 1.8% while Core PCE is at 1.3%, somewhat weak.

Business investment is down 1.5% while home investment is up 5.8% annualized.

The good news comes from inventories, which have cut 1.09 points from GDP growth. This recent depletion of inventories may result in their replenishing down the line.

The growth rate was achieved on top of weak inflation numbers, exposing the economy's weakness.

EUR/USD has initially topped 1.1030 but is retreating afterward.

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EUR USD reacting to US GDP January 30 2020

The US was expected to report an annualized Gross Domestic Product growth rate of 2.1% in the fourth quarter of 2019, mirroring the same clip as in the third quarter. However, the recent Durable Goods Orders figures for December missed expectations and probably downgraded real expectations.

EUR/USD was trading higher, around 1.1025, ahead of the publication. GBP/USD flirted with 1.31, boosted by the Bank of England's decision to hold rates unchanged. USD/JPY was at around 108.80.

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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