Euros tumble against the dollar following the release of the latest German IFO Business Climate report for October.
The EUR/USD pair fell by 0.3%. It settled at $1.182 in the latest charts as investors growing concerned about the health of the Eurozone’s largest economy.
The country missed the forecast of 93.0 after the index settled for 92.7 for the month’s latest development.
Nevertheless, the Current Economic Assessment for the same period hiked to 90.3 compared to the previous month’s 89.2 actual figure.
Similarly, the IFO Expectation Index, indicating projections for the next six months, also rose to 95.0.
Be that as it may, analysts noted that even with social distancing efforts to curb the spread of the virus in the old continent, the risk of stricter measures might, in turn, bring third-quarter growth to an abrupt reversal in the remainder of the year.
He added acknowledged that the recently released IFO index is not weak enough to cause another economic shock.
This applies not only to Germany’s economy but that of entire Europe as second wave havoc raises fear for a double-dip recession.
Due to heightened risk sentiments, the dollar index traded ahead of its counterparts in the basket of currencies in consecutive sessions last week.
Similarly, the firming greenback is supported by alleged rising Covid-19 cases in China dampened appetite for risky assets.
This came with the possibility of an economic setback to take place in the world’s second-largest economy.
The euro continues to tumble from green to red against the US dollar.
This is due to diverging economic pressure, igniting possibilities of bearish patterns, and serving as a roadblock to value growth.
Currently, the currency may further break the resistance level of $1.18. If so, it should trade between $1.19 to $1.21 should a bullish pattern appear along the way.
However, a setback has a great possibility to drag the EUR down the support level of $1.17. It may further experience a decline towards the $1.15 and $1.16 threshold.
Since last week, the momentum of the euro’s supporters and pullers remain at an equilibrium. The price consolidates at $1.17 and $1.18 price level.
Meanwhile, across the Pacific, the US dollar index shed off .1% as robust regional economic data in Asia puts the greenback to the base.
It was lower by the same margin against the yen and pound while it slipped further against the Aussie and kiwi in the latest foreign exchange charts.
- Trading Instrument