The euro retreats after a good performance in the Forex market. Progress in the European Union discussions has been positive, but some tensions in the negotiations have caused this withdrawal.
The European Union has gradually reopened its economy. And this has allowed a positive behavior in the operations of investors in the Forex market.
However, the doubt persists a little because of the next steps to be taken by the leaders of the Eurozone.
The euro reached a maximum of 4 months
The euro hit a 19-week high of $ 1.1467 on Monday. Backed by hopes that the European Union will agree on a recovery fund of 750 billion euros.
This in order to help resurface the EU economies. Economies affected by the pandemic, of which 390 billion euros could be offered as subsidies to the Eurozone states.
EU leaders have made progress at the economic summit in Brussels. After three days of talks on economic agreements and the measures to be taken to recover the economies hit by the coronavirus blocks.
However, disagreements over the composition of the recovery fund continue. Well, some leaders fear that this will directly affect their economies, further weakening the euro. Causing a fall in the currency in the Forex market.
Fund sponsors initially proposed € 500 billion in grants and € 250 billion in loans. Some countries opposed that in subsidies.
They saw 350 billion euros at most, but showed signs of commitment to keep the existence of subsidies and loans under discussion, since it is something that the European bloc needs.
The behavior of the European currency
The constant efforts of the European Union to cope with the crude blows of a pandemic without comparison, have caused confidence in the euro to be a constant in the Forex market.
Thus, analysts consider that the next level to observe the euro is $ 1.1495, which would take the currency to a maximum of a year and a half.
Analysts said the smaller the number of donations, and the more complicated the negotiations on approving the grants and loans from diplomats, the more the euro will fall.
Furthermore, the European currency still needs even more relevant factors to push it above these figures. Investors remain concerned about future EU decisions.
“It is still correct to believe that the market has not fully valued the outcome of a deal,” Saimbi said, noting that, according to the BNP positioning index, money managers were neutral in the euro.
Euro price at the time of writing
At the time of writing the article, the European currency is trading at its par with the dollar $ 1.1438, recovering a little its performance from last week. The euro retreats after a maximum of 4 months, but as it progresses on Monday, its figures have been correcting its performance.
In summary, currency analysts expect the performance of the euro to improve as economic discussions in the EU yield positive results.
The economic openings of the eurozone countries are promising, and although there is an increase in coronavirus infections, the figures are not entirely alarming.