• German GFK consumer confidence data beats forecasts, offering support to Euro (EUR)
  • ECB monetary policy meeting minutes to be released and could under pin Euro
  • Safe haven US Dollar (USD) well supported on rising covid numbers and ahead of a triple hit of US data releases
  • Euro US Dollar exchange rate (EUR/USD) struggles to hold US$1.1250

The Euro is trading mildly lower in a quiet start to the session. The Euro US Dollar exchange rate settled on Wednesday -0.5% at US$1.1252 amid a risk off climate.

At 06:15 UTC, EUR/USD trades -0.08% at US$1.1242 as risk aversion continues and as investors look ahead to a slew of US economic data.

The Euro is finding some support in early trade despite strong risk off sentiment keeping the safe haven US Dollar buoyant.

Increasing coronavirus cases, particularly in the US are raising fears that the economic recovery could be de-railed. The International Monetary Fund fuelled those fears by downgrading the global growth projections to -5%, down from -3% just 10 weeks earlier. The IMF highlighted the unprecedented hit to consumer spending and more economic scarring, with firms going out of business and people remaining unemployed for longer as reasons for the deeper downturn and more drawn out recovery.

German consumer confidence data has under pinned the Euro this morning. Household sentiment ticked higher to -9.6 in July, a significant improvement from June’s -18.9, and beating forecasts of -12. Whilst the data is a step in the right direction overall sentiment remains subdued and shows that it will take time for things to really pick up to pre-coronavirus levels.

Looking ahead the minutes from the latest European Central Bank meeting could provide additional support to the common currency.

US Dollar investors will look ahead to a triple hit of data releases, including jobless claims, durable goods and GDP data.

Initial jobless claims are expected to show that 1.3 million Americans signed up for unemployment benefits, slightly down from last week’s 1.5 million. Continuous claims which show the number of Americans being hired is also only marginally lower at 19.6 million, down from 20.5 million.

These figures show that the US labour market is only improving at a frustratingly slow rate. Weaker than forecast data could hit risk sentiment further and boost the safe haven US Dollar.

US GDP data is expected to confirm -5% annual contraction in the first quarter of the year. Meanwhile durable goods orders are expected to rebound higher. Any positive data could be overshadowed by rising coronavirus numbers.

Currencylive.com is a news site only and not a currency trading platform.
Currencylive.com is a site operated by TransferWise Inc. ("We", "Us"), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on currencylive.com do not represent our views.