- EUR/USD tracks global sell-off in risk assets.
- USD back in demand.
- No major economic releases ahead.
The probability of a more challenging COVID-19 situation, after the spread of a new virus-strain in London, hit the global risk sentiments and caused a bearish-gap opening in the EUR/USD at the start of the new trading week, after recording two-and-a-half-year highs on Friday.
The lack of progress in the Brexit talks also weighed on the sentiments.
The safe-haven appeal of the US dollar was back in demand, and this exerted downward pressure on the EUR/USD.
The sudden imposition of complete lockdown measures in London by the UK PM spooked markets. Boris Johnson had to move quickly to control the fast-spreading new coronavirus-strain. Apart from the virus fears, the deadlock in the Brexit-deal talks over the UK’s fishing waters also helped risk-bears.
The pandemic development and the Brexit logjam pushed the progress in the US fiscal stimulus bill – both political camps in the US agreed to a proposed aid-package.
The US FDA granted emergency use approval for the coronavirus vaccine developed by Moderna. Markets might find some solace from this development along with the fiscal bill progress, to stem the current sell-off. As the economic docket is sparse in the day ahead, the global risk sentiments will drive the action surrounding EUR/USD.
At the time of writing, one Euro buys 1.2203 US dollars, down -0.39% as of 9:30 AM UTC.