Euro continues its bearish downward momentum towards yearly lows of $1,17 mark amid growing concerns over “Delta” variant spread in the Eurozone, coupled with the elevating US dollar and Treasury yields.
As the super-contagious “Delta” covid variant began to spread across Europe, investors worry that the economic conditions in Eurozone could be worsened going into this winter, which pressures the growth-sensitive Euro and benefits the safe-haven US dollar.
EUR/USD falls to a key support level for the pair as a break below March’s 2021 lows of $1,17 could trigger a sell-off towards November’s 2020 swing lows of $1,16.
The US dollar extends its broad-based post-Nonfarm Payrolls report’s rally into this week, with the DXY-dollar index which predominantly weighted in Euros, climbing to as high as 93,20 mark, posting its highest level since early April 2021.
The 10-year US Treasury yield advanced to 1,37% on Wednesday morning, following six straight sessions of gains amid the stronger-than-expected NFP job’s report, and the hawkish comments from Federal Reserve’s members.
Investors expect that the bullish NFP jobs data for July would be one more step towards the Federal Reserve’s target of full employment after the pandemic, to start tapering its massive pandemic-led monetary stimulus programs and began hiking the zero interest rates.
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