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EURUSD is settling at the lowest level in four months
EURUSD Outlook – 29th March 2021
EURUSD fell in the morning of forex trading on Monday in the European market, and the single currency returned to record its losses against the US currency to be close to its lowest level in 4 months, and this comes with the reluctance of investors to buy high-risk currencies in light of their desire to buy the dollar.
The American economy as the best safe and alternative investment, in addition to increasing speculation that the US economy will recover at a faster rate than the European economy, the weakness of the euro indicates that it is driven more by concerns about weak growth prospects in the euro area, in light of the high incidence of Coronavirus.
EURUSD traded at $ 1.1762, down by 0.25%, from today’s opening session at $ 1.1790, to trade near the four-month low of $ 1.1761, which it hit last Thursday.
Over the course of last week’s trading, the single currency incurred losses by about 0.9% against the US currency for the second week in a row, in light of increasing expectations of a slowdown in the European economy.
The European currency is heading towards recording its worst monthly performance since mid-2019, as the stalled vaccination program began in Europe in light of a new wave of new infections, the cautious mood of the market prompted investors to resort to a safe haven, while the economic strength of the United States and the rapid launch of the vaccine also added to the brilliance.
EURUSD declines near a four-month high
The US dollar rose against a basket of major currencies in the morning of trading on Monday, with the increasing demand for buying it as a safe haven and alternative investment.
The dollar index traded at 92.80 points, up 0.1%, to trade near its four-month high of 92.868 points.
Demand for the purchase of the US dollar has increased over the past few weeks, as the cautious mood in the market has prompted investors to buy safe havens, while the US economic strength and the launch of the rapid vaccine have added more support to the dollar.
US jobless claims fell last week to their lowest level in one year, and President Joe Biden said he would double his vaccination target, after surpassing 100 million units 42 days ahead of schedule.
This has pushed bond yields up sharply this year, with the 10-year Treasury yield up to 1.75% last week.
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.