Euro attempted a rally against the US dollar earlier, taking advantage of the frustration many Forex traders have with US yields right now. However, that rally has fizzled out as the focus shifts to safe haven flows. Euro is lower against its low-beta counterparts, even as it gains against currencies like the pound and the loonie.
Earlier in the session, the euro looked ready to rally against the US dollar. At one point, EUR/USD reached the 1.3550 level. Right now, though, the 18-nation currency is barely above its session low against the greenback. Euro’s rally fizzled out as safe haven flows became more pronounced.
Issues relating to geopolitical instability are dominating headlines, with concerns about the continued tensions in eastern Ukraine following the downed Malaysian airliner, as well as the fighting that continues in Gaza. The desire for safe haven is overcoming the disappointment with US yields, and allowing the greenback the upper hand.
Euro is higher against other high beta currencies that rely on support from stocks, like the UK pound and the Canadian dollar. With investors concerned about instability, it’s all about safe havens today.
At 14:24 GMT EUR/USD is down to 1.3522 from the open at 1.3526. EUR/JPY is down to 137.0055 from the open at 137.1450. EUR/GBP is up to 0.7924 from the open at 0.7915. EUR/CAD is up to 1.4533 from the open at 1.4522.
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