EURUSD rises from its lowest level in two weeks as markets await
Last Updated on November 2, 2021
EURUSD rose in the morning trading on Monday in the European market and managed to climb from its lowest level in two weeks, which is recorded earlier in last Friday’s trading within the recovery processes, in light of the escalating fears of a widening gap between policies the monetary policy of the central banks in the United States and Europe, especially with the growing expectations that the Federal Reserve will tighten monetary policy during its next meeting, which will be held later this week.
EURUSD is recovering again
The EURUSD pair traded at the level of $1.1575, adding about 0.1% from the opening level of today’s session at $1.1565, and the single currency closed trading on Friday, incurring losses estimated at 1.05%, recording the largest daily decline since mid-June, and also recorded its lowest level in two weeks at $1.1535.
Over the course of last week’s trading, the Euro incurred losses against the US Dollar by 0.75%, recording its first weekly decline, amid growing fears of widening differences between the monetary policies of central banks in Europe and the United States.
Fed decision and US jobs data
The biggest catalyst for the EUR/USD last week was the recent interest rate decision by the European Central Bank, as the bank decided to leave interest rates unchanged as most analysts expected.
At the same time, the European Central Bank agreed to start reducing its asset purchases, while seeking to abandon easy money policies, however, Christine Lagarde insisted that the bank was not about to raise interest rates.
The European Central Bank’s decision was followed by relatively weak US GDP data, as figures showed that variable delta and supply challenges led to a sharp slowdown in the economy. Specifically, the data showed that the US economy declined by 2.0% in the third quarter, which was a sharp decline from the Previous 5.7%.
Meanwhile, US personal consumer spending data showed that the country’s inflation remained at its highest level in more than 30 years.
Therefore, the EUR/USD pair will react to the latest interest rate decision by the Federal Reserve, which will be released on Wednesday. Analysts expect that the central bank will keep the interest rate at the same current levels unchanged between 0% and 0.25%, it is also likely The bank indicates that it will start raising interest rates earlier than in the previous decision.
The bank is also expected to start scaling back the asset purchase program as the country’s economy continues to recover, the bank will be decreasing by about $15 billion per month, and the pair will also react to the latest US jobs data for the month of October.
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