EUR/USD consolidates around 1.1300 level amid receding US dollar
- EUR/USD bears take no heed, consolidate toward the 1.300 level.
- The pair may find impetus from several speeches lined up for the day.
- The euro area fresh COVID-19 spread worry investors.
The EUR/USD pair grinds lower towards 1.1300 level in the early Asian session on Thursday, on the back of receding US dollar and Treasury yields.
The shared currency pair has developed a mood of late and remained at its lowest since July last year. Now, expectations remain that the European Central Bank (ECB) would stick to its dovish policy settings in the near term. Against the backdrop of a slowing economy and as Covid-19 cases resurge throughout the continent.
On Thursday morning, Charles L. Evans, the chief executive officer of the Federal Reserve Bank of Chicago, sounds cautiously optimistic while saying, “It will take until the middle of next year to complete the Fed’s wind-down of its bond-buying program, even as the central bank remains ‘mindful’ of inflation.”
The Fed policymaker’s mixed comments weighed on the market sentiment and dragged the US equities down, keeping the Treasury yields pressured.
Previously, ECB president Christine Lagarde said that tightening monetary policy to curb inflation could choke off the Eurozone’s recovery. She further iterated factors pushing prices higher would fade next year, increasing contrast from hawkish hints from other central banks.
The Eurozone inflation for October rose by 4.1% YoY, in line with expectations. The MoM figure is at 0.8%, also in line with estimations and failed to trigger any reaction in the EUR/USD. Additionally, both Austria and the Netherlands announced lockdown measures. Germany is also due to meet next week to discuss tightening standards as infections start to peak.
Meanwhile, the greenback continued ardour reaching fresh 2021 highs and went out of steam on Wednesday, with the DXY falling back to the 95.80s.
Looking ahead, investors will be eyeing several Fed speeches and comments from ECB’s Fabio Panetta, Philip Richard Lane in addition to ECB President Lagarde.
EUR/USD technical levels
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