Euro Extends Decline Amid Fears of a Looming Recession in the EU

The  euro today fell against the  US dollar as  market sentiment remained decisively risk-averse amid fears that the eurozone was facing an imminent recession. The EUR/USD currency pair fell for the second consecutive session despite the release of upbeat data from Germany and the euro area, which did little for the pair.
The  EUR/USD currency pair today fell from an  opening high of  1.0907 to  a  low of  1.0817 in  the  American session and  was near these lows at  the  time of  writing.
The  currency pair fell today as  investor risk-appetite tanked in  the  face of  an  uncertain future for  the  euro area as  European countries start flattening the  COVID-19 curve. Investors are worried that recovery in  most EU countries will be slow and  that the  region could sink into a  recession over the  next few months. The  release of  in-line German consumer price index data by  the  Federal Statistical Office before the  markets opened had a  muted impact on  the  pair despite the  headline print meeting expectations set at  0.1%. The  upbeat eurozone industrial production data released by  Eurostat a  few hours later had zero impact on  the  falling pair.
The  release of  US initial jobless claims report by  the  Department of  Labor, which was lower than expected, also drove the  pair lower. Investors were pleased that the  jobless claims came in  12 million versus the  expected 13.5 million claims.
The  currency pair’s future performance is likely to  be affected by  tomorrows eurozone inflation data and  geopolitical events.
The EUR/USD currency pair was trading at 1.0849 as at 17:45 GMT having fallen from a high of 1.0907. The EUR/JPY currency pair was trading at 116.75 having dropped from a high of 117.50.

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