EUR/USD Declines on Signs of Growing Consumer Confidence in U.S.

EUR/USD declined today amid signs of economic growth in U.S. and concerns for European economic stability. The central bank in Spain took over the savings bank CajaSur, that was heavily harmed by the property-loan defaults, causing concern about resilence of European banking system. At the same time, reports from U.S. showed that consumer confidence increased and conditions on house market improved, adding to signs of U.S. economic recovery. EUR/USD trades near 1.2248 now.

S&P/Case-Shiller home price index based on the seasonally-adjusted prices decreased by 2.43% in March compared to the same month in 2009. It fell to 145.93 from 146 in month-to-month perspective.

Richmond Fed manufacturing index declined to 26 in May from April’s reading of 30. Analysts forecast decline to 25.

Consumer confidence increased to 63.3 in May up from 57.7 in April. A growth to 59.1 was expected.

Yesterday, a report on existing home sales was released, showing the increase to a seasonally adjusted annual rate of 5.77 million units in April from an upwardly revised 5.36 million in March. Traders expected a 5.56 million increase.