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EURUSD continues to rise, reaching its highest levels in a month
EURUSD Outlook – 23rd February 2021
EURUSD made a rise on the morning of Tuesday’s trading on mostly online trading platforms and recorded its fourth consecutive daily gain and its highest level in a month. These broad gains come thanks to the positive sentiment that dominates the market with increasing hopes for a faster recovery of the global economy.
The EURUSD traded at $ 1.2180, the highest in a month, up by 0.25%, from today’s opening session at $ 1.2152.
EURUSD rises after German data improved
German business sentiment improved during the month of February as the government launched a massive vaccination program, and according to the Ifo institute, the business climate rose from 90.3 in January to 92.4 in February, this rise was better than expectations of 90.5.
It is worth noting that manufacturing sentiment jumped to its highest level since 2018, and this was in line with the manufacturing PMI data released on Friday, and the data revealed that the German manufacturing PMI rose to 60.6 points, surpassing the average estimate of 56.5 points. The services and trade sector is doing well as the government has eased some of the previous shutdowns.
However, the data came at a time when the government began to warn of the rising number of coronavirus cases in the country.
The EUR/USD pair is also interacting with the upcoming debate over the $ 1.9 trillion packages proposed by “Joe Biden”, and Democrats have pledged to pass the package without support from Republicans who oppose some of its provisions. For example, many Republican leaders and some Democrats oppose the federal minimum wage The average is $15.
The US dollar deepens its losses
The USD extended its decline against many major currencies, recording its fourth consecutive daily loss and its lowest level in six weeks, as the dollar interacts with the high yields of US Treasury bonds, and they are also watching a key testimony by Jerome Powell and the ongoing stimulus negotiations.
The US Congress will continue its deliberations on the $ 1.9 trillion stimulus package presented by “Joe Biden”, and allocate about $ 1,400 in stimulus checks that will go to families. Moreover, the bill proposes a gradual increase in the country’s minimum wage to $ 15 an hour and funding for the states. And local governments, most importantly, that the bill will push the public debt of the United States to more than $ 30 trillion. Investors expect that the stimulus will lead to a rise in inflation, this is evidenced by the increase in Treasury revenues.
Professional Trader and Analyst, economist in Financial and Forex market since 2004.holds an MBA from the American University in Egypt. Mohammed works as an economic writer and technical & fundamental analyst for many international Forex and financial trading companies in both English and Arabic on a daily basis.