The Euro to US Dollar (EUR/USD) exchange rate softened by around -0.15% on Tuesday morning.
European data has had little by way of impact on single currency movement on Tuesday morning. This is as a result of unknowns regarding Greece’s future in the Eurozone as the Eurogroup members decide whether Greece’s debt repayment programme is acceptable.
The US Dollar, meanwhile, is generally holding in a position of strength versus most of its major peers. This can be attributed to speculation that Federal Reserve Chair Janet Yellen will abandon dovish language with regards to monetary policy.
The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1320.
Yesterday…
The Euro to US Dollar (EUR/USD) exchange rate softened by around -0.61% on Monday morning.
After oil prices softened amid oversupply in the US, demand for safe-haven assets caused the US Dollar to surge. Additional gains can be attributed to futures traders speculating that the coming week’s data will produce better results than recent weeks, potentially pressurising the Federal Reserve into hiking rates.
The common currency, meanwhile, softened versus most of its major peers thanks to disappointing data out of the currency bloc’s most influential economy. In addition to less-than-ideal German data, fears that Greece’s programme for their extensive loan repayment will be rejected by the Eurogroup officials also weighed on the Euro.
The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.1308.
Euro (EUR) Exchange Rate Softens ahead of Greek Debt Repayment Programme
After Eurogroup officials granted Greece a four-month extension to its current bailout programme, the common currency strengthened versus many of its major peers. However, as Greece prepares to present a programme outlining how they will gather the funds, the shared currency softened. This can be attributed to fears that if the programme is rejected, there will be no choice but for Greece to exit the Eurozone.
‘We are compiling a list of measures to make the Greek civil service more effective and to combat tax evasion,’ minister of state Nikos Pappas told Greek television network, Mega channel.
Additional single currency losses are as a result of disappointing German data publications. IFO Business Climate, Current Assessment and Expectations all failed to meet with median market forecast figures.
The Euro to US Dollar (EUR/USD) exchange rate has fallen to a low of 1.1296 today.
US Dollar (USD) Exchange Rate Gains on Oil Decline
In the immediate aftermath of Greece being granted an extension to their bailout repayment, market sentiment improved significantly. However, with oil prices resuming declination amid oversupply in the US, risk appetite dampened.
‘Despite optimism about the large drop in the US rig count in recent weeks, the pace of decline has been decelerating,’ Morgan Stanley said. ‘A further slowing (in rig count) would only reinforce concerns that a large production decline could take longer.’
Euro to US Dollar (EUR/USD) Exchange Rate Forecast to Extend Losses
Although US data is forecast to produce mixed results later on Monday, demand for safe-haven assets should see the US Dollar hold gains versus its European counterpart. However, there is the possibility of a Euro to US Dollar (EUR/USD) exchange rate recovery if Greece’s debt repayment programme is accepted by the Eurogorup.
There will be several influential data publications pertaining to both Europe and the US on Tuesday, which are likely to see EUR/USD volatility.
The Euro to US Dollar (EUR/USD) exchange rate advanced to a high today of 1.1393.
