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  • EUR/USD is hovering around the 1.1200 mark on Friday.
  • German final February CPI rose 0.4% MoM and 1.7% YoY.
  • US flash U-Mich index coming up next in the calendar.

The single currency remains under pressure at the end of the week, with EUR/USD trading on a firmer footing above 1.1200 the figure at the time of writing.

EUR/USD focused on COVID-19, risk trends

EUR/USD is struggling for direction on Friday following three consecutive daily pullbacks and amidst an increased volatility in the global markets in response to developments from the COVID-19 and the response from major central banks.

Indeed, the pair is extending the rejection from Monday’s tops in levels just shy of the 1.1500 mark to Thursday’s low in the mid-1.10s, where is located the key 55-day SMA. In the meantime, volatility remains on the rise following the advance of the coronavirus (in Europe and the US) and recent interest rate cuts by the Fed, the RBA, the BoC and the BoE.

The ECB, instead of reducing rates further at its meeting on Thursday, increased the current QE programme by €120 billion until end of this year and announced temporary LTROs and a permanent new TLTRO II to kick in in June.

In the docket, German final inflation figures for the month of February showed consumer prices rising at a monthly 0.4% and 1.7% from a year earlier. In addition, the CPI came in flat inter-month in France and contracted 0.1% MoM in Spain.

Across the pond, Import/Export Prices are due seconded by the preliminary reading of the Consumer Sentiment gauged by the U-Mich index.

EUR/USD levels to watch

At the moment, the pair is losing 0.06% at 1.1177 and faces the next support at 1.1100 (200-day SMA) followed by 1.1058 (55-day SMA) and finally 1.1055 (weekly low Mar.12). On the flip side, a break above 1.1495 (2020 high Mar.9) would target 1.1514 (high Jan.31 2019) en route to 1.1569 (2019 high Jan.10).

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