Let us check the market. Eurozone inflation remains weak, currently. During worries about the pandemic, sentiment is also weak.
Sentiment then faltered during fears that new COVID-19 hot spots across the world may jeopardize the swift recovery from the pandemic investors were hoping for. Thus, on Tuesday, a fresh batch of grim economic data kept the pound and the euro under pressure.
In the eurozone, underlying price pressures dropped again. So, this is underscoring fears that consumer price growth will remain anemic for years. Thus, in morning trading, the euro lost further ground against the United States dollar.
Britain’s Office for National Statistics said that the economy shrank by 2.2% between January and March. This is because households slashed their spending and this has been their worst performance since 1979.
Ricardo Evangelista is a senior analyst at ActivTrades. He said that it is undeniable that today’s data is not flattering for both the eurozone and the United Kingdom.
Euro and Other Currencies
Moreover, he added that today’s numbers are offering support to the United States dollar. This is because concerns are growing over a second wave of the coronavirus pandemic.
Before picking up slightly towards midday, the euro fell as low as $1.1199, losing close to 0.4%.
The euro staged a 1.7% comeback over the quarter, though. It was after falling by a similar margin amidst the first three months of the year marked by the coronavirus financial market cash.
After sliding to a one-month low of $1.2252 on Monday, the sterling traded at $1.2280. Moreover, on Monday, there were concerns about how Britain’s government would pay for its planned infrastructure program. This added to fears concerning its ability to seal a trade pact with the European Union.
The dollar index was up by 0.21%, at 97.632, against a basket of currencies. Thus, after upbeat United States home sales boosted Wall Street, it is now holding on to overnight gains.
This is the current news of the market.