The trade balance data for may disappointed. The trade deficit rose to 41.1B USD while consensus had called for 40.0B USD. Prior deficit was at 37.4B USD. The reading may spur concerns for expansion of the US economy in 2Q.
It’s worth noticing that six prior readings all were better than estimates, so this is the first miss of the year and it comes at time of higher volatility and uncertainty. Imports rose 1.6% m/m while exports declined 0.2% m/m.
The data may arouse concerns for the US GDP growth in 2Q. That’s why the reaction on EURUSD has been significant. The pair rose to 1.1085 but then the gains was pared somewhat.
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