EURUSD was dropped. Overview for 08.01.2020
On Wednesday afternoon, EURUSD continues the decline it started yesterday. The current quote for the instrument is 1.1150.
Investors like the USD right now and one of the reasons for that is good American numbers published yesterday. For example, the ISM Non-Manufacturing PMI increased up to 55.0 points in December after being 53.9 points the month before and against the expected reading of 54.5 points.
The components of the report show that the Business Activity improved from 51.6 points to 57.2 points, while two other items dropped a bit: the New Orders decreased from 57.1 points to 54.9 points and the Employment – from 55.5 points to 55.2 points.
However, broadly speaking the positive comes from changes in global tariffs. At the same time, market players didn’t pay any attention to the Factory Orders, which lost 0.7% m/m in November after adding 0.2% m/m in the previous month. Geopolitical pressure on the USD is getting weaker. After the Iranian major general Qasem Soleimani was killed in a targeted U.S. drone strike, the American market was very worrying about the escalation in the US-Iranian conflict, but right now the political intensity is reducing. However, it is important to remember that the current situation is as “fragile” as before: it didn’t have any continuations, but even theoretical scenario of what may happen are very frightening.