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Daily market commentary: The euro is slightly up against the US dollar



FOREX

The euro is slightly up against the US dollar during the early part of Thursday’s trading session, as the greenback recedes from the multi-month highs reached earlier in the week. The US currency had been supported by pandemic-related fears during the first part of the week, due to its safe-haven status. Such fears have now dissipated, as strong earnings improved the mood of investors and boosted risk appetite with notable gains in global stocks. Meanwhile, it’s interesting to see the euro, ahead of today’s ECB meeting, recovering from the lows reached on Wednesday; the general consensus is that the changes to their policy strategy, offering more flexibility towards inflation, will eventually become a headwind for the single currency with rates likely to remain low for longer.

Ricardo Evangelista – Senior analyst, ActivTrades

daily market analysis

GOLD

Gold is edging lower during Thursday morning, following a rise in risk appetite in global markets. Investor sentiment rose due to the galvanising effect of strong earnings that boosted global stocks and outweighed lingering uncertainty caused by the advance of the Delta variant. Another factor that may end up weighing down on gold is the bearish outlook for the euro. Today’s ECB meeting is expected to rectify the central bank’s strategic review, which will make it more likely for rates to remain lower for longer in the eurozone. This new approach is likely to represent a headwind for the single currency and offer support to the US dollar; a scenario that could potentially drive further losses for the precious metal.

Ricardo Evangelista – Senior analyst, ActivTrades


Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

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Daily market commentary: The euro is slightly up against the US dollar

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