The euro today inched higher against the dollar as rising eurozone coronavirus cases continued to weigh on the single currency amid mixed inflation reports. The EUR/USD currency pair was trading sideways earlier today before surging higher boosted by positive comments from European Central Bank policymakers.
The EUR/USD currency pair today rallied from a low of 1.1694 in the early Frankfurt session to a high of 1.1739 in the mid-European session and was near these highs at the time of writing.
The risk-averse market sentiment fueled the currency pair’s initial range-bound trading as investors adopt a wait and see attitude ahead of the US Presidential elections. The rising EU coronavirus cases, coupled with the lack of progress in Brexit talks, kept a lid on the single currency. The release of Italy’s consumer price index report for September drove the pair lower. According to Istat, Italy’s inflation fell by 0.7% versus the expected 0.6%. The release of the in-line eurozone inflation report for September released by Eurostat boosted the pair. The core inflation print came in at 0.1%, while the headline figure was 0.2%; both prints met expectations.
Comments from ECB Governing Council member, François Villeroy de Galhau that the bank’s current accommodative stance was appropriate fueled the pair’s rally. The greenback’s decline as tracked by the US Dollar Index, which hit a high of 93.59, also contributed to the pair’s rally.
The currency pair’s future performance is likely to be affected by the release of US retail sales data at 12:30 GMT.
The EUR/USD currency pair was trading at 1.1736 as at 12:05 GMT having rallied from a low of 1.1694. The EUR/JPY currency pair was trading at 123.57 having risen from a low of 123.11.
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Euro Rallies on ECB Comments and In-Line Eurozone Inflation Data
