EUR/USD Remains Offered Under the 1.1100 Benchmark, Watches Out for Events in Ukraine, Powell’s Comments
The Euro continues to struggle in negative territory and serves as a motivation to the EUR/USD trading pair to navigate the lower bounds of the range close to 1.1170 on Thursday.
EUR/USD price chart. Source TradingView
EUR/USD Suffers Weakness from Political Turmoil, Strong Dollar
The pair shed some of its gains for the fourth straight trading session and trades in close range of the YTD low points in the mid 1.1000 for the most part of Thursday.
The Russian military’s unchecked advance into various parts of Ukraine as the war between both countries continues to escalate has sustained the preference of investors for the safe-haven assets hunt as peace talks continue in Belarus in an attempt to achieve a ceasefire deal, first and foremost.
In the meantime, the market’s risk-off mood has kept the US dollar highly bided for, and the demand for Treasury bonds remains firm. All other motivating yields are speculated to ease after Wednesday’s attempt at influence by the bulls.
In the European dockets, the February Services PMI for Germany went higher to hit 55.6, and the EMU output also went up to 55.5. The Unemployment Rate went lower to 6.8%.
On the other side of the Atlantic, further testimonies from the Federal Reserves Chair, Jerome Powell, will be brought to attention and supported by the weekly Factory and Claims Order.
Things to Expect Around the Euro
The EUR/USD pair keeps looking out for geopolitical conditions and the market’s risk sentiment trajectory for directions. On the forgoing, the latest escalation in the raging war between Russia and Ukraine is speculated to maintain the pressure that the pair has been undergoing in the face of strong risk-aversion sentiment and the increasing demand for the US dollar.
In the meantime, a surge of energy in the EUR/USD pair should continue to be underpinned by speculation of a potential increase in interest rates by the European Central Bank, probably at an earlier date than anticipated by many. It should also be underpinned by potential higher German bond yields, a relatively decent momentum of economic activities, the need to preserve elevated inflation, and an auspicious outcome from significant statistical reports in the Eurozone.
Major Events in the Eurozone this Week
EMU Unemployment Rate Report, Germany/EMU Service Purchasing Managers’ Index, European Central Bank’s Account, EMU Retail Sales, and Germany’s Trade Balance.
Essential issues still remaining on the back boiler include some speculations about the ECB’s tightening monetary policy later in the year, the upcoming Presidential election in France, and the war in Eastern Europe.