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Euro Falls as Money Flows Into Dollar Amid Mixed Euro Area Macro Data

June 16, 2020 at 18:05 by Simon Mugo

EUR100, EUR200, and EUR500 notes with a chart

The euro today fell against the US dollar as investors moved money from currencies to other assets such as stocks given that most European equities closed higher. The EUR/USD currency pair today fell as investors moved capital into the safe-haven dollar causing it to rally against most other currencies as investors reacted to the Fed’s latest moves.

The EUR/USD currency pair today fell from a high of 1.1354 in the early European session to a low of 1.1228 in the American session but was off these lows at the time of writing.

The pair’s decline was triggered by the Federal Reserve’s announcement that it would start buying corporate bonds, which had a direct impact on the equity markets. Investors also cheered news that Donald Trump‘s administration was considering a new $1 trillion infrastructure spending stimulus bill. The release of German consumer price inflation report for May early in the European session boosted the pair slightly. The Federal Statistical Office reported that both the monthly and annualised CPI prints met analysts expectations. The release of the upbeat German ZEW economic sentiment survey for June, which came in at 63.4 versus the expected 60.0 had a minimal impact on the falling pair.

The release of US retail sales data by the Census Bureau also contributed to the pair’s decline. US retail sales rose 17.7% in May versus the expected *% boosting the greenback as tracked by the US Dollar Index, which hit a high of –.

The pair’s future performance is likely to be affected by tomorrow’s multiple eurozone releases and geopolitical events.

The EUR/USD currency pair was trading at 1.1265 as at 18:04 GMT having fallen from a high of 1.1354. The EUR/JPY currency pair was trading at 120.85 having dropped from a high of 122.12.

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