Euro Falls Despite Upbeat Euro Area Macros as Dollar Surges on Stimulus

The euro fell against the dollar fueled by the negative investor sentiment following dovish comments from an ECB policymaker regarding rising European yields. The EUR/USD currency pair’s rally was further driven by the surge in US Treasury yields as bonds sold off following the signing of the $1.9 trillion US stimulus bill.
The EUR/USD currency pair fell from a high of 1.1988 in the Asian market to a low of 1.1910 in the mid-Frankfurt session but was slightly off these lows at the time of writing.
The currency pair rallied, boosted by the dollar’s strength as bond markets sold off in anticipation of a flood of new US government bonds to fund the $1.9 trillion stimulus package. The release of the inline German consumer price index report for February had a muted impact on the pair. According to the Federal Statistical Office, Germany’s inflation rose 0.7% monthly, translating to an annualized 1.3%; both prints met expectations. The release of the upbeat eurozone industrial production report for January coincided with the pair’s bottom. According to Eurostat, the region’s industrial production rose 0.8%, beating analysts estimates of 0.2%.
Dovish comments about the ECB’s PEPP purchases from Madis Muller also drove the pair lower. The upbeat US February PPI data released by the Bureau of Labor Statistics kept the pair at its lows. The upbeat University of Michigan US consumer sentiment index drove the fibre lower.
The currency pair’s performance over the upcoming weekend is likely to be affected by geopolitical events and dollar dynamics.
The EUR/USD currency pair was trading at 1.1913 at 15:28 GMT, having fallen from a high of 1.1988. The EUR/JPY currency pair was trading at 129.99 after dropping from a high of 130.34.
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Original from: www.earnforex.com