Thursday ended with the EUR/USD being high above of local resistance of 1.10. What's the target now?
Euro slumps as the crisis of the government coalition worsens in Germany
On Monday, the common currency slipped at the beginning of the trading session right after German Chancellor Angela Merkel got another blow when her interior minister, who told that he was on the verge of resigning because of the country’s migration policy.
Horst Seehofer, Germany’s Interior Minister, who actually backed tightening border controls, told he was geared up towards resigning from his current position and also as chairman of the Christian Social Union, Merkel’s junior partner in her coalition.
After Friday’s considerable soar, the common currency rapidly lost momentum because the departure of Seehofer is going to be considered to be an uncertain future for Germany’s current Chancellor Merkel.
On Friday, the common currency rallied after the EU leaders came to a migration agreement, which market participants hoped would relieve the pressure on Merkel.
The evergreen buck ramped up its revenue versus the Japanese yen, hitting a fresh six-week maximum because the latest poll of the Bank of Japan Tankan disclosed a moderate dip in the mood of key Japanese producers. Additionally, the activity index in the sector of key producers in the second quarter headed south from 24 to 21 in the first quarter. In the services sector the index of business activity tacked on to 24 from 23.
The Australian dollar edged down after the publication of weaker data on the activity index in the manufacturing sector of China and Australia.
Meanwhile, in June, the index of business activity of the manufacturing sector of Australia dived a bit from May’s reading of 57.5 to 57.4.
In addition to this, in June, the manufacturing sector in China kept expanding, although a slower tempo, according to the last survey of Caixin.
In June, the index of business activity of the Chinese manufacturing sector tumbled to 51.0 from May’s outcome of 51.1.
The EUR made a significant rise on the news of the stimulus expansion. Will it last long?
April seasonal patterns weren’t supposed to work, but somehow they did. Even a strong fundamental issue such as the global recession amid the coronavirus couldn’t overwhelm it. That’s why May seasonal patterns may work as well.
The market sentiment has switched to risk-on, driving upwards stocks and riskier currencies and weighing on the US dollar.
Non-Farm payrolls will be out on Friday at 15:30 MT time! Are you ready?
US ISM Manufacturing PMI is coming out on Thursday at 17:00 MT time! Be ready!