09.04.2019: Trump interrupts incipient euro’s rally (EUR, USD, GBP)
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The single currency firmed amid the softened greenback. However, the happiness of the euro’s buyers did not last long as Donald Trump broke in the process.
The euro/dollar pair passed through the resistance zone and suddenly rose to $1.1275 on Monday due to the weakness of the US dollar. Although, it declined later on. The pair finished the day at $1.1260. However, it is headed upwards again on Tuesday trading near $1.1271.
Buyers are trying to get the euro/dollar pair going, yet they have been failing so far. In spite of the growth, the single currency is under pressure and ruled by bears. It is trading on the downside against all the currencies except the Swiss franc. Moreover, Donald Trump decided to rein in the euro.
Nevertheless, the most popular pair managed to handle the US threats to introduce new tariffs on the European goods over “unfair” subsidies to Airbus. This news turned out to be an unpleasant reminder that the United States might choose the European Union, its main trading partner and competitor at the same time, as the next victim after China. It looks like a new reason for a slowdown in the global economy is rising on the horizon.
Meanwhile, the pound remains unstable as traders are nervous amid the looming Brexit that should take place on Friday. It inched up by 0.1% in the early trade, then its pace of growth increased, so the British currency went above $1.31. However, it did not manage to consolidate there and declined to $1.3078 which was still above yesterday’s high.
Theresa May is going to visit Berlin and Paris today to meet German Chancellor Angela Merkel and France’s President Emmanuel Macron. The British Prime Minister will try to convince the two leaders to support the delay of Brexit. Besides, Mrs May is to speak at the EU summit in Brussels on Wednesday where the final decision on the deadline extension will be taken.
Market players are tired of the unstable news background, so they are not likely to make any major investments today awaiting more significant news from the United Kingdom.
There are two more important events ahead: the meeting of the European Central Bank with the following press conference by Mario Draghi and publication of the minutes of the Federal Open Market Committee’s March meeting. Together with the Brexit news, it is expected to trigger a high volatility in the market on Wednesday.
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