Long-awaited US GDP report for Q2 2020 was released today at 1:30 pm BST. Data showed that the US economy shrank at an annualized 32.9% QoQ. Market expected a drop of 34.1%. Private consumption declined 34.6% (exp. -34.5%).
It is the sharpest contraction ever as many companies were forced to close stores and factories due to the ongoing pandemic and many people to stay at home, which negatively affected consumer and business spending.
Meanwhile number of Americans filling for unemployment benefits was 1.43 million in the week ended July 25th, after 1.41 million in the previous period, bringing total claims to near 52.14 million since March 21st when the coronavirus pandemic started in the US. Today’s reading came in slightly below market expectations of 1.45 million.
Continuing claims, which lags initial jobless claims data by one week, reach 17.01 million, while analysts expected 16.2 million.
It is the second straight week of increasing initial claims which might be a sign that due to surging number of new COVID-19 cases, the labour market recovery may take much more time than initially expected.
EURUSD saw relatively small reaction to today’s data releases. The most popular currency pair continued to trade around 1.1750 level. Source: xStation5
