The euro today appeared to cool off against the US dollar following yesterday’s massive rally that saw the EUR/USD currency pair breach the 1.1080 level as the greenback fell. The currency pair today traded sideways alternating between gains and losses amid a lack of significant releases from the European dockets.
The EUR/USD currency pair today traded between a high of 1.1087 and a low of 1.1066 as investors took profits from yesterday’s rally and was within this range at the time of writing.
The currency pair came under pressure earlier today as President Donald Trump announced that he would impose taxes on French exports to the US, including French wine. The US President said this while criticising French President Emmanuel Macron‘s remarks that NATO is “brain dead.” The European Commission reiterated that it would react to US tariffs on French exports as a block, which could set the stage for a new trade war in 2020. The pair was also affected by Trump’s insistence that he was in no rush to secure a deal with the Chinese, which dampened investors’ risk appetite
The single currency failed to capitalise on the greenback’s overall weakness as tracked by the US Dollar Index, which hit a low of 97.75. The release of the eurozone producer price index report for October by Eurostat also had a muted impact on the pair despite the monthly print beating expectations.
The currency pair’s future performance is likely to be affected by trade headlines and tomorrow’s multiple euro area Markit PMI releases.
The EUR/USD currency pair was trading at 1.1073 as at 13:26 GMT having fallen from a high of 1.1087. The EUR/JPY currency pair was trading at 120.42 having dropped from a high of 120.95.
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