After 5 straight sessions of gains, the Euro is edging lower on Friday as the safe haven dollar gains ground. At 08:30 UTC, FUR/USD is trading -0.1% lower at US$1.1022.
The pair is still on track for a weekly gain in the region of 3%, paring some of the 3.7% decline from the previous week.
EU Leaders Clash On Coronavirus Response
The Euro is slipping lower in early trade on Friday as EU leaders fail to agree over coronavirus response. Member states are clashing over the extent to which they should pool their resources to fight the economic fallout from coronavirus. Germany and norther European states are rejecting calls for the introduction of joint bonds.
The failure to agree how to move forward comes as the eurozone heads for a deep recession. Data from Germany on Thursday showed that consumer confidence plunged. French and Italian confidence have also slumped. When consumers lack confidence, they slow down their spending which is bad news for any economy.
US Consumer Confidence Up Next
The safe haven US Dollar is attempting to claw back losses on Friday, as investors digest the latest coronavirus headlines. The number of cases in the US have surged, surpassing 83,500, meaning the US now has more cases than China or Italy. The death toll has risen to 1000. The sheer speed at which coronavirus is spreading through America, the world’s largest economy is scaring the markets.
Dismal data from China overnight is also boosting demand for safe havens. Data showed that Chinese factory profits slump by the most on record.
Today investors will look ahead to US consumer confidence data. Analysts are expecting morale to have slumped to 90 on the University of Michigan Sentiment Index in March, down from 95.9 in February.
If consumer have lost their job or fear losing it, confidence drops. Given the record breakingly awful initial jobless claims figures yesterday, there is a good chance that consumer confidence will be worse than what analysts are forecasting.
