- Euro (EUR) advances despite covid cases rising & dovish ECB
- EZ consumer confidence in focus
- US Dollar (USD) edges lower in quiet Thanksgiving trades
- Biden expected to back large stimulus package
After a flat finish in the previous session, the Euro US Dollar (EUR/USD) exchange rate is edging marginally higher on Friday. The pair settled on Thursday at US$1.1913, the same level that it started trading. At 09:15 UTC, EUR/USD trades +0.04% at US$1.1919. The pair is in line to gain 0.5% across the week, its second straight week of gains.
The Euro is advancing are yesterday’s decline. Weaker than expected German consumer confidence data and dovish minutes to the latest European Central Bank meeting dragged on the common currency.
The minutes from the November ECB meeting revealed that policy makers saw risks to growth clearly tilted to the downside, agreeing that this warranted an adjustment in its monetary policy in December. The prospect of further monetary easing next month could cap any gains in the common currency.
Covid cases continue to rise on the old continent with Germany recording 1 million infections. Lockdown in Germany has been extended to 20th December.
Today attention will remain firmly on the Eurozone economic calendar with Eurozone consumer confidence in focus.
The US Dollar is slipping a few points lower in quiet Thanksgiving trade as investors are broadly expecting the new Joe Biden administration to back large-scale fiscal stimulus to ease the covid hit to the economy.
There is also growing speculation that Biden will back tougher measures to stem the spread of covid as areas of the US see a pike in cases. Biden has made it clear that the pandemic is his first priority. He has called on Congress to pass a stimulus bill before the start of the new year when he officially takes office.
There is no US data due for release today. Whilst US markets open for half a day, volumes are expected to be light.