Euro Posts Slight Gains EUR/USD has edged upwards on Friday, as the pair trades at the 1.06 line. US markets were closed on Thursday for Thanksgiving and trade will likely remain light until next week. On the release front, there are no major events out of Europe or the US.
The stunning US election results caused turmoil in global markets, and there has been concern that the Eurozone economy could be negatively affected by Trump’s victory. So far, however, recent Eurozone and German indicators have been solid. Germany business confidence levels remain high,
as underscored in the November Ifo Business Climate report. The index continues to hover around the 110 level, pointing to strong optimism about the German economy. This report is the first look at the German business sector’s reaction to the Trump election victory, and the reading appears to show that German companies are not worried about the US election results. However, the ECB Financial Stability Review was less sanguine. The report warned about the risk of sudden corrections in global markets due to “higher political uncertainty”, which could hurt economic growth. The report didn’t give examples, but it’s a good bet that the report was referring to the Brexit vote and Donald Trump’s election as president. With Brexit negotiations expected to start shortly and Trump taking over as president in January, we could see plenty of volatility from the euro in the coming weeks. The euro remains under pressure and dropped down to 1.0517 on Thursday, its lowest level since November 2015. EUR/USD is down 3.3 percent in November, and there is growing talk of the euro dropping to parity with the high-flying US dollar.