The EUR / USD can consolidate within its range of 1.15-1.20 as risk sentiment improves, the European Central Bank (ECB) is likely to keep policy unchanged. Rising COVID-19 Cases and Restrictions Should Limit EUR Gains, Report Economists from Westpac.
“While ECB members have indicated throughout this week that there is unlikely to be any change in their policy stance at next week’s ECB meeting, there has also been a growing sense of concern about the persistent rise in interest rates. COVID-19 cases, not only in Spain and France, but also in Italy, Germany and the entire euro zone. He Increased curfews and restrictions will put pressure on the region’s recovery“.
“The pandemic will continue to be a dominant factor for regional politics and growth. However, the huge success of the first European SURE bond issue (Support to mitigate Unemployment Risks in an Emergency) this week, also the higher issuance of sustainable bonds in EUR, has provided support for the common currency. The 17,000 million euros on offer (divided between 10 and 20 years) were subscribed 14 times (more than 233,000 million euros) “.
“The euro may be benefiting from global risk appetite, as a US support package looks more likely. However, it is still possible that the EUR / USD remains in its recent range of 1.15-1.20 ”.
Credits: Forex Street
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