- US dollar (USD) uptick weakens the pair.
- Risk-off mood gains the upper hand in markets.
- ECB policy on focus, GDP numbers shrugged off.
The EUR/USD recorded sixth continuous negative close yesterday as the US dollar demand was in vogue amidst risk-off sentiments in the markets.
The downtick extended the previous day’s weakness as the traders came back to the pit after the US Labour Day holiday.
The global equity selloff marked the turn in the risk sentiments as the chances of a no-deal Brexit increased and AstraZeneca pushed the testing of coronavirus vaccine to a later date.
Euro had a weak run since the comments from ECB officials regarding its strength against the greenback and shrugged off a Eurozone-GDP upward revision. The second-quarter GDP contraction was put at -11.8 Percent from an earlier estimate of -12.1 Percent, by the Eurostat. The common currency continued its pullback from 28-month highs – above 1.2000, and has touched a three-week low during the early Asian session today.
The bears might not be able to extend this run further as the focus has now shifted to the ECB decisions due tomorrow; traders usually prefer to wait on the sidelines before such significant events. The pair might be confined in a range ahead of ECB as both the US and Eurozone look forward to a light economic-docket.