EUR/USD breaks 1.15 on 'Sell America' momentum – Danske Bank
|The US Dollar (USD) extended its decline as markets reacted to Trump's threats against Fed Chair Powell, worsening US asset market dynamics, and thin holiday liquidity. EUR/USD surged past 1.15, driven by ongoing risk aversion and safe-haven rotation away from the greenback. With no obvious trigger for a reversal, sentiment remains broadly bearish on the USD, Danske Bank's FX analysts report.
No clear catalyst for USD rebound
"The USD extended its sell-off as the unusual confluence of falling US equities, higher long-end Treasury yields, and broad-based dollar weakness gained traction, following President Trump's remarks suggesting he might fire Fed Chair Powell."
"Notably, the comments had limited impact on prediction markets, where the odds of Powell's removal in 2025 remain around 20%. Thinner holiday liquidity may have amplified the move. EUR/USD pushed above 1.15, with persistent 'sell America' momentum propelling the cross to its highest level since late 2021."
"Looking ahead, it is hard to see a catalyst for a sustained USD rebound amid a deteriorating US growth outlook and growing dysfunction in US asset markets, which increasingly undermines the USD's safe-haven appeal."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.