Euro breaks another key support level

The Euro was once again under pressure in yesterday’s trading session after the latest minutes meeting from the US Federal Reserve which left the market pondering about the central bank’s next moves.The minutes were pretty vague, and there was no clear picture on when the Fed would begin to slash their bond buying program or begin to lift interest rates from record low levels which were brought about by the coronavirus and the following recession it caused.

One of the most surprising things to come from the meeting is that Fed board members believe the expected progress in the US economy is still lagging behind but retreated, they should still keep their arsenal of tools ready should the situation change.
Some of the concerns are a possible reemergence of the coronavirus as well as inflation which although at the moment is moving higher, will only be temporary and could suddenly drop as the economy reopens.

Another factor against the Euro was the release of industrial production figures from Germany which hit the market at 0.3% which was well below expectations for a figure of 0.5% and show’s Europe’s largest economy still has someway to go to overcome the effects of the pandemic.

The Euro has broken down through another key support level of $1.1810 which has now turned into a resistance level in today’s trading session.This will prove a tough barrier for the Euro to break due to the lack of economic news from the Eurozone and the US for the rest of the week. 

There could be a test of the $1.1750 support level which may be driven by a speech later today from ECB president Christine Lagarde which she will outline the ECB’s inflation expectations and economic outlook.