The EUR/USD currency pair remains under pressure in today’s trading session following on from yesterday’s losses and continues to hover near its four-month low ahead of key Eurozone data.
The Zew economic sediment index from Germany will be the focus of investors today and the market expects a reading of 57 versus last months figure of 63.3 which is a worrying sign for Europe’s financial powerhouse as it tries to recover from the effects of the coronavirus which has decimated the economy.
Also not helping the Euro’s cause were comments yesterday from Fed committee member Raphael Bostic who note that the US central bank should begin its bond tapering program between October and December of this year and he joins a number of other Fed board members who have echoed the same thoughts.
The outlook for the Euro on the chart is becoming more negative as it holds below the July low of $1.1750, the July low and the chances are growing of the EUR/USD currency pair pulling back to the next support level of $1.1705 reached in March.
A strong set of CPI figures from the US due for release tomorrow may be the cause for this retreat and the possibility of a break at this level is also a possibility which will see the currency pair at a 8.5 month low.