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An improved situation in Europe and hopes for the EU Fund may help the euro weather the storm triggered by growing US coronavirus concerns, Yohay Elam, an analyst at FXStreet, informs. 

Key quotes

“Markets have finally begun noticing the increase in US coronavirus cases seen in several large states such as California and Florida, where hospitalizations are on the rise. Most significantly for stocks’ reaction, infections and admissions are surging in Texas and especially in Houston. Reimposing lockdown measures is on the cards.”

“The euro seemed to hold up in comparison to its peers. One of the reasons is that Europe – hit hard by the disease – continues showing a downtrend in COVID-19 cases while it is gradually opening up. More importantly, the European Commission is working on plans to reopen borders and flights. Germany, the continent’s largest economy, is also moving forward with encouraging travel.”

“Negotiations in European capitals over the ambitious EU Fund – which includes €500 billion grants raised by the Commission – continue. Hopes that it will be approved continue underpinning the euro.”

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