The Euro’s bounce off a 14 month low seems to be short lived, and the EUR/USD currency pair is back down below the phycological $1.1600 mark as we enter the European trading session as traders take positions in the greenback as a safehaven while waiting the release of key economic data later today.
There are still lingering fears that Evergrande, China’s biggest property developer may default on its debt payments which may lead to the company’s collapse and send shivers throughout the financial markets. Evergrande, it seems, is not the only company to fall on hard times and another significant property developer, Fantasia Holdings Group’s missed debt payment. While another one named Sinic downgraded has been downgraded by Finch ratings.
Political infighting in the US is also keeping the currency markets on edge which is benefiting the US dollar as the indecision between the Republican and Democratic parties over the passage of the US infrastructure spending bill continues to drag on and nearly caused a shut down of the US government. There is due to be further talks today and any sign of an agreement on the spending bill is likely to benefit the Euro.
The main drivers of the EUR/USD currency pair today will be the release of Markit services PMI figures from Germany and the Eurozone a whole during the European session while in the American session, we will also see the release of Markit PMI figures as well as ISM services numbers.
On the chart we can see the Euro managed to stage a 2-day recovery against the greenback but the party was short lived and in any case the move upwards resembles more of a dead cat bounce than any meaningful recovery.
Apart from fears out of China and political infighting in the US, market participants will most likely be unwilling to place significant bets against the US dollar while they await the release of the Non-Farm payrolls figure on Friday which may determine the start date of tapering from the US Federal Reserve.
|Facendo clic su “Continua” verrai reindirizzato al sito internet di proprietà della FIBO Group Holdings Limited, una società registrata a Cipro e regolamentata dalla CySEC. Puo' leggere le condizioni del Contratto Cliente al link. Fai clic su “Annulla” per rimanere su questa pagina.|