EURUSD fluctuating near 1.0900 ahead of the US presidential election, which will influence market sentiment.
EURUSD consolidating around 1.0890 during Tuesday’s European session. On the day of the presidential election in the United States (US), the major currency pair stays below the critical resistance level of 1.0900. At the time of writing, the US Dollar Index (DXY), which tracks the value of the greenback against six major currencies, was trading consistently near 103.80.
Greenback showed a strong purchasing trend as traders priced in former US President Donald Trump’s election.
In October, the Greenback showed a strong purchasing trend as traders priced in former US President Donald Trump’s election. However, it problems with Extend its rise further as traders anticipate fierce battle between Trump and current Vice President Kamala Harris. The chance of Trump’s win has decreased after a Des Moines Register/Mediacom poll showed Harris gaining a three-point lead in Iowa, where the Republican party won a clear majority in 2016 and 2020.
“A Red Wave (favoring Republicans) would spark a significant USD rise. According to TD Securities analysts, it would reawaken memories of US exceptionalism, which underpinned by tariffs, tax cuts, deregulation, and negative implications on the outlook for the EZ and China.
While the US presidential election will be the main event for the US dollar this week, investors will also pay close attention to the Federal Reserve’s (Fed) monetary The policy choice will be announced on Thursday. The CME FedWatch program predicts that the Fed will lower interest rates by 25 basis points (bps) to 4.50%-4.75%. Investors will watch Fed Chair Jerome Powell’s speech for new clues about anticipated monetary policy action in December.
On the economic front, investors anticipate the October US ISM Services Purchasing Managers Index (PMI), which will be release at 15:00 GMT. The Services PMI expected to be 53.8, down from 54.9 in September, indicating that service sector activity expanded at a slower rate.
Daily market movers: EURUSD remained flat-lined despite the Euro’s mixed performance.
EURUSD trades inside Monday’s trading range as investors pause ahead of Polls for the US election have opened. In an event-packed week, the US Dollar is projected to be the primary driver of the major currency pair.
While the Euro (EUR) struggles versus the US Dollar, it performs poorly against Asia-Pacific currencies following a positive Caixin Manufacturing and Services PMI. Nonetheless, it outperforms other major currencies as traders reduce European Central Bank (ECB) dovish wagers.
Investors expect Kamala Harris and Donald Trump to compete head-to-head.
Market investors expect the ECB to lower the Deposit Facility Rate by 25 basis points in December. Previously, investors were expecting a 50-bps interest rate decrease by the ECB in its last policy meeting of the year, as few policymakers noted mounting risks to economic growth and underscored the need for major economic stimulus to increase. Domestic expenditure and investment.
The ECB significant rate drop bets faded following better-than-expected Eurozone Q3 GDP growth, which allayed worries of an economic slump. Meanwhile, updated German and Eurozone HCOB Manufacturing PMI figures have improved compared to flash readings. However, the manufacturing output index remained below 50.0, indicating that the decline trend continues.
