The euro today fell against the US dollar amid thin holiday trading conditions ahead of tomorrow’s Christmas holiday celebrations. The EUR/USD currency pair’s performance was not influenced by any significant fundamental news but was primarily driven by investor sentiment.
The EUR/USD currency pair today fell from an opening high of 1.1093 in the Asian session to a low of 1.1069 in the mid-European session before recovering some of its losses.
The currency pair’s decline was primarily driven by the resurgent greenback as tracked by the US Dollar Index, which hit a high of 97.79. The pair failed to capitalize on yesterday’s rally as the greenback rallied higher driven by the risk-off market sentiment. Investors seemed to prefer the dollar ahead of tomorrow’s Christmas holiday as a hedge against the thin liquidity witnessed across the global financial markets. The pair’s performance was also affected by investor fears about the resumption of US-China trade hostilities amid lingering doubts about the signing of the phase one trade deal. Chinese officials have expressed concerns about President Donald Tump‘s commitment to the recently agreed phase one trade deal.
Investors appeared to forget the downbeat US durable goods orders report for November released by the Census Bureau as they bought the US dollar. The greenback also benefited from the flight to safety trade, given the low trading volumes.
The currency pair’s performance over Christmas and boxing day is likely to be influenced by trade headlines and geopolitical events.
The EUR/USD currency pair was trading at 1.1085 as at 15:26 GMT, having rallied from a low of 1.1069. The EUR/JPY currency pair was trading at 121.18, having fallen from a high of 121.37.
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