The euro today fell against the much stronger US dollar as tensions between China and the US skyrocketed, causing investors to seek refuge in safe-haven assets. The EUR/USD currency pair due to the prevailing risk-off market sentiment in the financial markets that saw European equity markets close lower for the day.
The EUR/USD currency pair today fell from a high of 1.0961 to a daily low of 1.0895 during the American session and was trading near these lows at the time of writing.
The currency pair opened today’s session trading with a heavy bearish bias as the war of words between Donald Trump‘s administration and China heated up over the weekend. President Trump accused China of lying about the severity of the virus from the beginning leaving the rest of the world ill-prepared for the current pandemic. US Secretary of State Mike Pompeo and his trade counterpart Peter Navarro both backed up the President setting the stage for another significant spat with China. The release of upbeat Markit Germany Manufacturing PMI for April by Markit Economics had a muted impact on the pair as did the disappointing Markit eurozone manufacturing PMI.
The release of the disappointing US factory orders report for March by the Census Bureau did not provide the expected reprieve to the pair. The greenback rallied for most of today’s session as tracked by the US Dollar Index, which hit a high of 99.60.
The currency pair’s future performance is likely to be affected by geopolitical events and tomorrow’s US data.
The EUR/USD currency pair was trading at 1.0903 as at 18:32 GMT having fallen from a high of 1.0961. The EUR/JPY currency pair was trading at 116.38 having dropped from a high of 117.01.
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