EUR/USD drops towards 1.1900 as bonds bears dominate ahead of US Pres. Biden’s speech
|- EUR/USD refreshes intraday lows, extends Friday’s pullback moves.
- Yellen tried to placate bears but failed amid hopes of further stimulus, vaccine news.
- ECB’s Kazaks teases scaling back of stimulus, Fed meeting will be the key.
EUR/USD takes offers around 1.1930, down 0.25% intraday, while heading into Monday’s European session. In doing so, the currency major drops for the second consecutive day as US Treasury yields keep favoring the US dollar ahead of US President Joe Biden’s speech, up for publishing at 17:45 GMT.
US 10-year Treasury yields stay mildly bid around 1.64%, the highest levels since February 2020, marked on Friday, as market players shrug off US Treasury Secretary Janet Yellen’s comments, published during the weekend. In her interview with the ABC, the diplomat accepted near-term risks to the rates but ruled out reflation fears. The ex-Fed Boss also praised US President Biden’s $1.9 trillion stimulus to escalate economic recovery in 2021.
Also exerting downside pressure on the quote could be comments from the ECB Governing Council Member, also Latvian central bank Governor, Kazaks who said, "If the economy performs better, it could be possible to provide less support". It’s worth mentioning that Netherlands’ stipulation on the AstraZeneca vaccine until March 29 and political plays in Germany also weigh on the EUR/USD prices.
Against this backdrop, stock futures in the US and Brussels pare early Asian gains whereas the US dollar index (DXY) gains 0.22% on a day while recently picking up bids near 91.80.
Looking forward, US President Joe Biden’s speech will be the key but all eyes will be on this week’s Fed meeting.
Also read: Will the Fed calm us treasury market volatility?
Technical analysis
EUR/USD bears eye re-test of 200-day EMA level, currently around 1.1835 amid last week’s failures to cross 100-day EMA, at 1.2006 now.
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.