EUR/USD again faces rejection above 1.1440, EU stalemate weighs

EUR/USD is trading largely unchanged on the day near 1.1419, having faced rejection above 1.1440 during the Asian trading hours. The pair has repeatedly failed to establish a strong foothold above 1.1440 since Wednesday. 

EU stalemate weighs

The European Union (EU) leaders remain deadlocked on Monday after three days of haggling over a recovery fund to revive the European economies hit by the coronavirus pandemic. The stalemate coupled with a 0.30% decline in the US stock futures at press time is likely weighing over the common currency. 

‘An FT reporter tweeted about 30 minutes ago that the EUR 375 billion grants figure, which leaders are haggling over, has now been pushed to EUR 390 billion. The news put a mild bid under the EUR/USD, lifting it higher from 1.1415 to 1.1425. The minor pop, however, was short-lived, as the grants number is still below EUR 400 billion demanded by the French and southern European nations. 

As per the latest reports, the EU meeting has ended and will reconvene Monday at 14:00 GMT. Leaders have been told by Charles Michel, President of the European Council, that a new basis for an agreement is €390bn in grants. The EUR may have another go at the resistance above 1.1440 if the grants figure is pushed higher to EUR 400 billion, although gains would be short-lived if the deal remains elusive. 

Apart from the newsflow from the EU meeting, the pair may take cues from the German Producer Price Index, Eurozone Current Account, and German Buba Monthly Report. 

Technical levels