Search ForexCrunch

EUR/USD has been edging higher as President Trump pushed for fiscal stimulus but low chances of a deal, rising eurozone COVID-19 cases and positioning ahead of the weekend may weigh on the pair, according to FXStreet’s Analyst Yohay Elam. 

Key quotes

“President Donald Trump has changed his mind and now wants to negotiate a stimulus deal with Democrats. The White House’s new approach comes is boosting stocks and weighing on the dollar, helping the common currency.”

“While Trump, House Speaker Nancy Pelosi and US Treasury Secretary Steven Mnuchin want a deal, Senate Republicans seem reluctant to go along. Majority Leader Mitch McConnell said that some of his colleagues feel they have already done enough.” 

“National and state polls have shown that challenger Joe Biden is increasing his gap against Trump, opening the door to a landslide victory. For markets, it means a lower chance of stimulus, and thus a potential rise in the greenback.”

“Coronavirus cases are surging in the old continent, prompting a potentially new state of emergency in Spain, restrictions in more French cities, and measures in other countries as well.” 

“Another reason to be skeptical of EUR/USD gains is the long weekend in the US. Investors may prefer taking bets off the table.”