Key Takeaways
- 💸 Uncertainty in Europe and potential aggressive trade policies in the U.S. may impact EUR/USD
- 📉 Deutsche Bank forecasts EUR/USD falling to $1.05 by end of year
- 🇺🇸 US election and trade policy could push EUR/USD to parity against the dollar
- 🌐 Political backdrop in Europe could negatively impact long-term competitiveness
- 💰 Euro struggling due to political uncertainty in Europe
- 🚫 Trump White House pursuing aggressive protectionist trade policy could push euro to parity against the dollar
- ⚔️ Potential impact on euro if Trump wins upcoming presidential race
- 📉 Bearish momentum on daily chart is weakening, with RSI showing a slight rise
- 💡 Risks to the upside present, but 2-way trades likely before French election on Sunday
- 📊 Support levels at 1.0660/70 and 1.06, resistance levels at 1.0770 and 1.0810
- ⚠️ Risk warning: CFDs are complex and high risk, retail investors often lose money trading them.
- 🔹 President Macron calling a snap legislative vote shocked France and Europe
- 🔹 Macron’s move to reassert authority may backfire as Ensemble coalition is polling third
- 🔹 RN party leading in polls, but may not have enough seats for a majority in National Assembly
- 🔹 RN softening radical policies to appeal to mainstream voters calms market fears
- 🔹 Concerns about France’s high debt, risk of political instability, and economic impact on Eurozone
Key Takeaways
- 🌍 Europe’s competitiveness impacted by political instability
- 💹 EUR slipped overnight but losses are limited to recent range
Impact of Political Uncertainty on EUR/USD Exchange Rate
The Euro to US Dollar (EUR/USD) exchange rate is facing significant challenges due to a combination of political uncertainties and potential trade policies. The Deutsche Bank forecasts a decline in the EUR/USD rate to $1.05 by the end of the year, while the looming US election and trade policy shifts could push the Euro to parity against the Dollar.
The political backdrop in Europe is also a cause for concern, with President Macron’s surprising call for a snap legislative vote in France causing shockwaves in the region. However, efforts by the RN party to soften radical policies and appeal to mainstream voters have calmed market fears to some extent.
While the Euro has been struggling against the Dollar, support and resistance levels are being closely watched by traders. Risks to the upside in the EUR/USD rate remain, but two-way trades are expected before the French election on Sunday. Overall, concerns about political instability, high debt levels in France, and the economic impact on the Eurozone are contributing to the pressure on the Euro.