The euro today struggled to rally against the US dollar as the World Economic Forum drags on in Davos, Switzerland. The EUR/USD currency pair today fell to new 2020 lows before recouping its losses as investors grappled with the emerging risk posed by the Coronavirus.
The EUR/USD currency pair today fell to a low of 1.1075 before rallying to a high of 1.1095 and was in the middle of this range at the time of writing.
The currency pair struggled to rally today despite the positive comments from both the US and China regarding the phase one trade deal and the upcoming phase two trade negotiations. Steven Mnuchin, the US Treasury Secretary, confirmed that the US was very pleased with the phase one trade deal from Davos. The upbeat trade comments could not boost the euro as investors remained cautious in the face of the new coronavirus cases report in Hong Kong and the US. The release of the weak French business climate data for January by Insee also did not help the pair. The release of the mixed Italian industrial sales and orders report for November by Istat also contributed to the pair’s woes.
President Donald Trump‘s harsh criticism of the US Federal Reserve‘s rate hikes in the past few years saw the US Dollar Index drop to a low of 97.55, but the euro did not benefit from the greenback’s fall.
The currency pair’s short-term performance is likely to be affected by multiple US macro releases and vital Davos speeches.
The EUR/USD currency pair was trading at 1.1081 as at 11:28 GMT, having fallen from a high of 1.1095. The EUR/JPY currency pair was trading at 121.84 having dropped from a high of 122.01.
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