The Euro to US Dollar exchange rate pushed higher today as US jobless claims caused investors to remain cautious of USD.
At the time of writing the pair are currently trading at around $1.2083.
Euro (EUR) Supported by US Dollar (USD) Weakness
The Euro has been supported today as its negative correlation with the US Dollar (USD) pushes the single currency higher.
A fall in US Treasury yields has resulted in the US Dollar weakening this morning, allowing the Euro to push further and gain on the back of the negative correlation.
However the Euro’s gains have been limited today following the preliminary Eurozone consumer confidence for February.
Although gaining on the previous month by 0.7 points and beating forecast of -15, the indicator remains deep in contraction.
Continuing lockdowns across the bloc to help combat the coronavirus pandemic cause investors to remain cautious over the state of the Eurozone economy.
Weak Jobless Claims Pushes Down US Dollar (USD)
The US Dollar was again on the back foot today as a fall in treasury yields did nothing to support the currency.
Furthermore, initial jobless claims in the US for the week ending February 13th showed an unexpected rise despite cities across the US lifting coronavirus restrictions.
Ann Elizabeth Konkel, economist at Indeed Hiring Lab commented on the figures, saying:
‘Total initial claims broke their three-week streak of declining numbers. The movement of this number is going in the wrong direction, and at 6.7 times higher than the pre-Covid era, magnitude also remains a problem.’
US President Joe Biden continues to fight for his proposed $1.9 trillion stimulus package to be adopted, as a one-time stimulus payment made in December helped to push retail sales up at the start of 2021.
Euro to US Dollar Outlook: Eurozone Flash PMI’s in Focus
For Euro investors, tomorrow will see the release of flash Markit PMI’s from the Eurozone, which are forecast to show a slight increase for February. If the PMI’s do beat forecasts EUR could see itself gaining further.
US Dollar traders will themselves be looking towards their own PMI data releases tomorrow, with contractions expected in both services and manufacturing, the US Dollar could suffer.
Euro to US Dollar exchange rate movement will also continue to be dominated by any further coronavirus developments, with any indication that lockdowns across the Eurozone will be extended putting pressure on EUR.