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Euro Rallies Higher Against Weak Dollar As Europe Slowly Reopens

June 15, 2020 at 20:00 by Simon Mugo

An inclined stack of 1 euro coinsThe euro today rallied higher against the much weaker US dollar boosted by positive investor sentiment as US indices posted gains triggering a selloff of the greenback. The EUR/USD currency pair today fell earlier in the session as the dollar traded in positive territory, but this changed later as investor risk appetite grew.

The EUR/USD currency pair today rallied from a low of 1.1226 in the Asian session to a high of 1.1332 in the American session and was near these highs at the time of writing.

The single currency fell briefly at the start of today’s session driven by investor worries about rising coronavirus cases in Europe and across the globe. The pair then proceeded to trade sideways for most of the European session as investors remained undecided. The release of the eurozone’s trade balance report for April by Eurostat hurt the currency pair, causing it to fall. According to the report, the euro area’s trade surplus fell to €2.9 billion in April as compared to the €28.2 billion recorded in March. Italy’s Istat also released the country’s latest consumer price index report showing that inflation fell 0.3% in May versus the expected 0.2% decline dragging the pair lower.

The pair rallied higher in the American session as US equity markets rallied higher reversing demand for safe-haven assets such as the dollar. The rally coincided with a significant drop in the US Dollar Index to a low of 96.60.

The currency pair’s future performance is likely to be affected by tomorrow’s German and European ZEW survey data.

The EUR/USD currency pair was trading at 1.1308 as at 19:59 GMT having rallied from a low of 1.1226. The EUR/JPY currency pair was trading at 121.41 having risen from a low of 120.32.

If you have any questions, comments, or opinions regarding the Euro, feel free to post them using the commentary form below.

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