- EUR / USD is under pressure as the greenback continues its correction to FOMC minutes.
- The FOMC is clearly concerned about the trajectory of the US economic recovery, weighing on risk sentiment and the stock market.
EUR / USD has nailed the downside to the minutes of the Federal Open Market Committee highlighting that a ‘very accommodating stance on monetary policy is likely to take some time’.
However, that has not prevented the greenback from running through the forex space to fresh recovery peaks in the DXY at 92.94.
A mixed and confused FOMC sends supplies from a cliff, supported by the DXY
The minutes have not offered much in the way of solid guidance, but they have led to the idea that revenue caps would only provide “modest benefits in the current environment”, which has given U.S. revenue a boost, supporting the greenback .
At the time of writing, EUR / USD is trading at 1.1832, 2 pips below its low and is up from the day to a 1.1952 high.
The minutes also showed that the FOMC was worried about the road to recovery and some members suggested that additional accommodation might be needed to promote the economic recovery as inflation returned to 2%.
The minutes showed that participants’ risks included included additional waves of spread of viruses that could cause credit markets to resurface, such as loss of fiscal support to households, businesses and local government.
The greenback is gathering a potential bid for safe haven here, as the correlation of precious metals and the U.S. stock market both activation classes look tumbling.
Spot gold is down 3% and the SPX is losing 0.17%.
The euro is also correlated with such movement in named markets, improving the DXY to fresh corrective highs.
EUR / USD levels
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