Vasilis Tsaprounis
Independent Analyst
The single European currency remains above 1,13 level, digesting the mild rise of the last three days, where in the wake of concerns about the course of US debt, the dollar has come under pressure.
After falling to a low of 1.1065 last week, the European currency has recovered almost 300 basis points higher, but remains in a wider trading range, confirming recent thoughts where I had given some good probability on the scenario that the exchange rate would remain between the levels of 1.11 and 1.16.
Despite the recent agreement between the United States and China on trade tariffs, investor concern remains as the 90 days are a period that will pass quickly and considering the controversial personality of President Donald Trump, no one can predict his next moves.
The cautiousness is also beginning to be reflected in the course of international stock markets, where after the S&P barometer index approached the threshold of 6,000 points, liquidations returned to the table and the continuation of the rally would, in my opinion, be a significant challenge that does not have the greatest chances at the moment.
In terms of macroeconomic data, interesting data today are the indexes of the services and manufacturing sectors in the Eurozone and the United States, which often act as harbingers of economic growth or not.
The exchange rate looks set to remain within a known range of fluctuation with the chances of any major surprises being small.
No changes in my thinking it seems that the consolidation mode remains the basic function with the European currency having returned to the fore but without showing signs of a strong momentum which could easily lead it back to the recent highs of 1.1575 with the prospect of continuing for even higher levels.
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