EUR/USD Tests New Yearly Highs on Weak US Dollar

The EUR/USD currency pair today rallied to new yearly highs based on US dollar weakness triggered by the failure of Donald Trump‘s administration to repeal Obamacare. The currency pair rallied higher on news that two more Republican senators had defected and would not support the US Senate’s attempt to repeal and replace the Affordable Care Act (ACA).
The currency pair gained over 100 points at the height of its rally as the US dollar demonstrated weakness during most of today’s session.
The US dollar opened today’s session generally weaker against the euro as news of the Republican Party to rally its senators to back the repeal of Obamacare. This development was extremely damaging to the US dollar as it cast major doubts as to whether Donald Trump would implement any of the major policy reforms he had promised during his campaigns. The US Dollar Index, which tracks the greenback’s performance, was trading below its opening price of 95.16 for most of today’s session.
The release of disappointing German ZEW economic sentiment survey data, which came in at 17.5 versus the market consensus of 18, had minimal impact on the euro. The German ZEW survey of the current situation also fell short of expectations as it was recorded at 86.4 versus the expected and previous figure of 88. The two surveys were largely ignored by the markets.
The currency pair’s future performance is likely to be affected by further political developments in the USA.
The EUR/USD was trading at 1.1580 as at 16:06 GMT having rallied from a low of 1.1470 earlier today. The USD/JPY was trading at 111.86 having dropped from a high of 112.62.

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