The euro has been gaining ground, reaching its strongest level in several weeks, buoyed by positive German economic data and a weakening US dollar. Concerns over US trade policy and geopolitical tensions are weighing on the dollar, while the euro benefits from improved economic sentiment in the Eurozone. Investors are closely monitoring the EU-US trade dispute and upcoming economic data releases for further direction.
- The euro extended gains above $1.17, reaching its strongest level since January 6.
- Germany’s ZEW Economic Sentiment Index jumped to 59.6 in January, its highest since July 2021.
- The dollar weakened following renewed tariff threats from the US President.
- EUR/USD climbed to a two-week high above 1.1700.
- The pair’s resurgence of the upside impulse follows renewed downside pressure on the US Dollar (USD).
- The European Central Bank (ECB) also held rates steady at its December 18 meeting.
- Non-commercial positioning continues to favor the Euro (EUR).
The asset is experiencing a period of strengthening influenced by a combination of factors. Positive economic indicators from key Eurozone economies are boosting confidence, while external pressures on the US dollar provide additional tailwinds. While some anticipate potential shifts based on future data releases and policy decisions, current conditions suggest continued upward momentum for the asset.