EURUSD remains weak under the pressure of the news.
The major currency pair continues weakening early in November. The current quote for the instrument is 1.1640.
EURUSD has much room for escaping risks and that’s putting pressure on the Euro: from lockdowns in Germany and France to the presidential elections in the USA. A dynamic escape from risks increases investors’ interest in the “greenback” as a “safe haven” asset. However, this is what is happening right now – in the future, a lot of things may change because market attention will switch to the FOMC and American authorities, which will have to provide the country’s economy with additional stimulus. But right now, the demand is in favor of the USD.
As early as on Tuesday, the USA will have this year’s key highlight, the presidential elections. There are two front-runners for the head of the state position and they are both extremely scandalous, that’s why it’s almost impossible to say which of them will be better for the country. Still, investors decided to escapes risks, just in case, but it didn’t decrease the market volatility, the peak of which is expected to Tuesday-Thursday.
Starting today, Germany is introducing a “soft” lockdown – several quarantine restrictions are intended to reduce the coronavirus spread rate in Europe. The same was done by France, which is also suffering from mass infection. Restrictions are good if they reduce the “load” on medical workers and medical facilities and risks for the population. However, both German and French economies are looking pretty weak and may not survive the second lockdown.
Earlier, the ECB already warned about the risks of the economic slowdown in the Euro Area, which may reflect in the November macroeconomic data. That’s a huge risk for the Euro.