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EUR/USD Hitting New Lows

The EUR/USD has been hitting new lows regularly and not showing any signs of reversal. The US is taking various economic boosting measures and it is expected that employment opportunities will increase in the coming months. Approximately, half a million jobs were added to the economy in September.

The decision taken in the Senate about lifting the debt ceiling to alleviate the fears of debt default has added a further boost to market sentiment.

The EUR/USD continues the downtrend and shows no clear signs of a turnaround anytime soon. On Thursday, investment in stocks and currencies escalated. The Wall Street index and bond yields marked the aggravation in their numbers as well. Another important acknowledgment is the uprise in the rate of 10-year US treasury bonds by 1.6%.

Europe is in a state of revival from the complications caused by the pandemic and is continuing with the Pandemic Emergency Purchase Program (PEPP) initiated by the European Central Bank. The program is expected to end next year in March amplifying the chances of the economy falling into inflation. These measures are indications that investing in Euro will not be a lucrative step.

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On the other hand, Fed Chair Jerome Powell briefed about the beginning of asset tapering as the country refined its economic conditions that were crumbling during the pandemic. Investors were eyeing the non farm payrolls that were released last Friday. It is a measure of employing the country and is an important determinant of the country’s economic status. The US expected 500,000 whereas the results signal 194,000. The unemployment rate evidently fell from 5.2 to 4.8% in the month of August. USD is expected to be bearish temporarily after these results.

Although Powell remarked that the employment rate will not be affecting the asset tapering plan, the steps will be taken irrespective of the results. If there is something that will be striking the US dollar, it will be the market conditions. Imprecise interpretation of the circumstances of the country will be more accountable for the changes in the USD.

The EUR/USD is trading around 1.1571 and is expected to vary in the coming days.  

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