EUR/USD on a firmer footing in New York

• EUR/USD has moved to print a higher high for the day, recovering from Asian lows.
• ECB is committed and the euro is hamstrung as covid continues to concern investors. 

EUR/USD is moving towards the final hour of trader on Wall Street on the front foot after making fresh highs in the early New York day and recovering from the opening downside correction in Asia. 

At the time of writing, EUR/USD is trading at 1.2053, up 0.03% having recovered from a low of 1.2019 and meeting a high of 1.2066 for the session so far. 

The US dollar has been pressured following Friday's Nonfarm Payrolls report.

January Nonfarm Payrolls rose a disappointing 49k and December’s Job Losses were revised to -227k (-140k). 

However, one slice of the data did show that Unemployment fell sharply by 0.4% to 6.3% which is supporting the divergence in the economic growth narrative compared to that of other economies. 

However, updated population estimates were added to the household survey data.  Those additions meant the estimated size of the labour force fell 206k and unemployment fell 586k.

Nonetheless, other data has been showing signs of improving momentum in the economic recovery with initial jobless claims falling for the third straight week, and the ISM manufacturing and service surveys were solid. 

This data will come before the Federal Reserve's Chair Jerome Powell who speaks to the New York Economic Club and is exp[ected to come with a more upbeat tone than prior rhetoric for where he downplayed the thesis for an early taper. 

Meanwhile, the European stock market was breaking new highs on Monday. 

Europe had been lagging US and Asian bourses rising to new highs, but Germany's DAX  was 14,169.49 in early trade before losing most of the gains through the session ending up a small 0.02%.

Still, the pan-European STOXX 600 is still about 5% below its 433.90 records reached in February last year as the coronavirus spread continues to concern investors and weigh on the single currency pertaining to a dovish European Central Bank.

European leaders have stated in recent times that they are wary of new variants of Covid-19 and have been battling growing infection rates, mainly since Christmas.

Moreover, investors are concerned that the vaccinations began in late December and that the rollout has been complicated across the region.

Additionally, the IMF had recently lowered its growth expectations for the euro area in 2021 and preliminary reading pointed to an annual Gross Domestic Product contraction of 6.8% for the euro area in 2020.

President Lagarde has stated “our commitment to the euro has no limits,” adding,  “our preferred tool is the pandemic emergency purchase programme (PEPP), which differs from the ECB’s other asset purchase programmes,” meaning that the euro will be hamstrung for the foreseeable future.