EURUSD is falling back on the heels of more economic data

Mohammed Abdelkhalik
June 7, 2021

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EURUSD Outlook – 8th June 2021

EURUSD returned to decline at the beginning of the week’s trading and recorded its first losses in light of the avoidance of trading investors from buying high-risk assets and their focus on buying the US dollar as the best alternative investment, amid anticipation of more economic data that will reflect the extent of the economic recovery of the euro area especially with the strong recovery of the US economy, which may force the Federal Reserve to tighten its monetary policy soon.

The EURUSD pair traded at $1.2144, down more than 0.1% from today’s opening level of $1.2160.

EURUSD closed Friday’s trading, up 0.3% recording the first daily gain in the rebound from a three-week low at $1.2103, led by a decline in the US dollar following the lower-than-expected non-farm payrolls data.

EURUSD chart - 8th June 2021

The single currency recorded losses of about 0.2% against the US currency, recording its first weekly decline, in light of the rise of the US dollar against most of the major currencies.

EURUSD continues losses

The US dollar witnessed a rise against a basket of major currencies with the opening of today’s session in the European market, recovering from the losses it incurred on Friday, following the monthly jobs report for the month of May that came in less than expected, and the markets are awaiting the US inflation figures to be released later this week.

The dollar index traded at 90.180 points, up less than 0.1% from the opening level.

The US Department of Labor revealed the non-farm jobs report during the month of May, and the report showed the addition of about 559,000 jobs less than expected, which indicated an increase of about 650,000 jobs added, this comes after adding about 278,000 jobs in the month of April.

The market was watching the jobs numbers which are a strong indicator of growth, however, the data showed that the recovery in job growth was not strong enough to force the Fed to tighten monetary policy soon.

The markets are awaiting later this week the US inflation data, which will be a means of pressure on the Federal Reserve to change its monetary policy.

Author Mohammed Abdelkhalik

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.