The Euro traded flat at $1.1207 on Friday. It declined by approximately 1% versus the Dollar since Tuesday. Investors were waiting for a European Union summit. They expected bloc leaders to attempt to navigate regional divisions over a 750 billion euro coronavirus recovery fund.
Meanwhile, the British pound was also flat at $1.2433. According to some data, British retail sales recovered more strongly than expected last month. Despite that, public borrowing jumped to a record high as debt overcame economic output.
On Friday, French Junior European Affairs Minister, Amelie de Montchalin, noted that she could not rule out Brexit talks ending without a deal. However, it remains in Britain’s interests to reach an agreement.
What about the U.S. dollar?
The dollar rallied on Friday. Traders’ fears that the second wave of coronavirus cases could hinder a swift economic recovery boosted the currency. All in all, the Dollar has gained about 0.3% last week against a basket of currencies, even though it traded flat in European morning trade on Friday.
New infections were detected in Beijing, increasing investors’ concerns of a return to global lockdowns. There was also a surge in coronavirus cases in many U.S. states last week.
Even if there won’t be a “second wave,” a renewed rise in virus numbers shows that things are not going to return to normal for a long time – stated Commerzbank analysts.
In Asia, the Australian Dollar rose by 0.3%, trading at $0.6875 on Friday. The currency has rallied by almost 25% from March lows. But Australian Prime Minister Scott Morrison’s statement caused more turmoil in Forex markets. He said that a “sophisticated state-based actor” has been trying to hack a wide range of Australian organizations for months.
U.S. President Donald Trump renewed his threat to cut ties with China, further distressing investors. Furthermore, tensions remain high between India and China. Both countries agreed to try de-escalating their confrontation in the western Himalayas, but so far, the situation remains the same.