Vasilis Tsaprounis
Independent Analyst
The single European currency remains near the 1,03 level for the third consecutive day and although it remains in a contested environment, it has not yet approached the recent low of 1,0220.
Yesterday, as expected, did not yield any surprises. The closed markets in the United States due to Jimmy Carter's funeral limited volatility with investors avoiding any big bets.
We are in the 4th consecutive month where the European currency remains under pressure as the main factors that have influenced the euro remain on the table.
In addition to the geopolitical risks, the difference in interest rates in favor of the American currency and the concerns about the course of the European economy, there is the politics of the new President Donald Trump, who, from his statements alone, has given a fresh boost to the American dollar.
If he confirms his rhetoric regarding the imposition of further tariffs on imports, there is a risk of new inflationary pressures in the American economy which will create new data regarding the prospect of further reductions in key interest rates by Fed.
There is a lot of speculation surrounding this prospect, but I will maintain a more conservative approach as I have some doubts about the actual impact of this development on the path of inflation.
As this development is for the foreseeable future, for now the markets will focus on today's data on new jobs in US , which always follow with great interest and often act as a game-changer.
Possible disappointing data is expected to trigger a new reaction for the European currency.
I remain on hold without any change in my thoughts about buying the European currency on fresh dip, possibly well below the recent lows of 1.0220.
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