Euro Suffers over Sovereign Debt Fears
The Euro has come under pressure in the last few days as fears mount over sovereign debt contagion. The Euro has fallen against most of the worldâ€™s most actively traded currencies with the key EUR/USD pair making new lows at 1.3170 and GBP/EUR testing the 1.19 mark towards the end of the UK session today.
Confidence in the Euro remains fragile and the USD is currently benefiting from positive sentiment, yesterdays better than expected non-manufacturing (or services) ISM for last month and the substantially better than expected ADP employment report have continued to bolster the USD today.
The Dollar is being supported by speculation that economic growth in the US is accelerating. The Euro however continues to suffer as the cost of insuring debt in the Eurozone increases on fears of the mounting European debt crisis.
The news of substantially better than expected service sector growth in the US has prompted forecasters to change their predictions for Non Farm Payrolls tomorrow. The 300,000 boost in service sector jobs indicates that perhaps unemployment in the USA could dramatically fall from the current close to 10% unemployment level moving forwards into 2011.
Eurozone Retail Sales figures today show that sales in November fell 0.8% from October yet increased 0.1% from 2009. This stagnation failed to support the Euro. The primary concern was that Portugalâ€™s Retail Sales figure declined by 4.2% in November compared to October. This drop has been fuelled by the countries ongoing efforts to reduce their budget deficit.
Most market participants are bullish on the USD providing economic data continues to support the USD, and bearish the Euro on debt concerns. We would expect the Euro to continue to come under pressure this week and the Dollar to remain relatively range bound trading around the 1.55 mark pivot coming to the weekâ€™s end.
Torfx Currency Dealer
â€œAny opinions expressed in this document are those of TorFX analysts. Any analysis and/or forecasts provided are aimed at helping clients understand market conditions and developing trends. Clients are wholly responsible for their own trading decisions.â€
Currency Articles - Dec 2, 2015 11:35 - 0 Comments
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