The euro today declined against a resurgent US dollar in the wake of the intensifying trade spat between the US and China. The EUR/USD currency pair headed lower in the late Asian session as the greenback rallied higher and the selling pressure increased during the early European session.
The EUR/USD currency pair today declined from a high of 1.1619 in the Asian session to a low of 1.1575 in the early European session.
The currency pair’s decline was largely triggered by the escalating trade tensions between the US and China, which dampened the risk sentiment in the market and boosted the US dollar. The pair was also dragged lower by warnings from the European Central Bank regarding the growth outlook in the Eurozone and globally given the impact of the trade tensions. The warnings were the highlight of the latest monthly economic bulletinreleased by the ECB, which focused on the downside risks to global trade and economic growth.
The greenback’s rally also contributed to the pair’s decline as tracked by the US Dollar Index, which hit a high of 95.35 earlier today. The release of the upbeat initial jobless claims data by the Department of Labor also dragged the pair lower. The weak US Producer Price Index also released today had a muted impact on the pair.
The currency pair’s future performance is likely to be affected by geopolitical events and tomorrow’s US CPI data.
The EUR/USD currency pair was trading at 1.1588 as at 13:47 GMT having dropped from a high of 1.1619. The EUR/JPY currency pair was trading at 128.65 having declined from a high of 129.00.