- Euro (EUR) advances on weaker USD
- Eurozone industrial production due tomorrow
- US Dollar (USD) eases as treasury yields stabilize
- US CPI on Wednesday
The Euro US Dollar (EUR/USD) exchange rate is trading 0.1% higher after falling for the past three straight sessions. The pair settled -0.3% lower in the previous session at US$1.2150, towards the lower end of the daily traded range. At 09:15 UTC, EUR/USD trades +0.1% at US$1.2158.
The Euro is managing to claw higher today but the technical outlook for the pair is broadly bearish at least in the near term.
Covid cases in the region continue to surge and the vaccine programme has been very slow in getting off the floor.
This week is a quiet week for Eurozone data releases. Yesterday’s Spanish industrial production missed forecasts falling -0.9% month on month in November. Annually, output plunged -3.8% reflecting the ongoing impact of the Covid 19 crisis.
There is no major Eurozone economic data due to be released today although Eurozone industrial production will be under the spotlight tomorrow. Should Wednesday’s Eurozone industrial production data underwhelm, the Euro could take another leg lower.
The US Dollar, which has been surging higher in recent sessions finally paused for breath on Tuesday, consolidating recent gains.
The US Dollar Index which measures the greenback versus its major peers traded -0.1% at the time of writing.
Despite today’s pullback in the USD, the tone surrounding the greenback has been bullish over the last few days as expectations of huge fiscal stimulus from a Democrat sweep mean that the Federal Reserve could soon start tapering its bond purchases, lifting US treasury bond yields.
US President elect Biden takes office on 20th January and has promised trillions in additional covid stimulus measures. As a result the US treasury yield has pushed above 1% for the first time in 10 months.
There is no high impacting US economic data today. Attention will turn towards US inflation data which is due to be released tomorrow.
