After so many ‘dead cat bounces’ for the euro – it seems that now it is the dollar’s turn as President Trump is set to lay out a plan for the stimulus that may fall short of expectations, Yohay Elam from FXStreet informs.
Key quotes
“It took Giuseppe Conte, Italy’s PM, less than 48 hours to move from locking down only the north of the country to all the country.”
“Concerns around Europe may later weigh on markets and send investors back to the safety of US debt, weighing on EUR/USD.”
“President Trump has finally opened the door to fiscal stimulus in addition to specific budgeting for treating the virus. Nevertheless, these may be too little and too late. The administration is considering a payroll tax cut which addresses demand and not supply, the main issue.”
“When details of the plan come out later, markets may be disappointed at the details – and the ongoing lack of leadership. An initial rise in stocks may send Trump back to his complacency.”
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