- EUR/USD trades in the red ahead of German retail sales and manufacturing data.
- Tuesday’s recovery from 1.0930 failed to inspire the bulls in Asia.
- Investors are likely to hold cash, preferably US dollars, amid the coronavirus-induced economic stalemate worldwide.
EUR/USD remains on the offer while heading into the London open, as Tuesday’s notable recovery from lows near 1.0930 failed to invite stronger buying pressure in Asia.
The currency pair faced rejection near 1.0940 during the early Asian trading hours and fell back to 1.010 even though China’s Caixin Manufacturing PMI, which focuses on small and medium-sized export-oriented units, blew past expectations to indicate expansion in the activity in March.
German data eyed
The data, due at 06:00 GMT, is forecasted to show consumer spending, as represented by retail sales, rose 1.5% year-on-year in February, following January’s 1.8% growth.
Meanwhile, the Markit Manufacturing PMI figure is expected to come in at 45.5, highlighting a slight deterioration from the preliminary estimate of 45.7. A weaker-than-expected data will likely draw offers for the common currency, sending EUR/USD to levels below 1.10.
Across the pond, the US ADP Employment report and the ISM Manufacturing data are scheduled for release. A big miss on expectations may push the greenback lower across the globe. The losses, however, could be short-lived, as the coronavirus outbreak is showing no signs of slowing down with the number of cases in the US rising above 177,000. The number continues to rise in Europe, with Spain and Italy reporting a total of 200,000 cases.
With the economic activity around the globe nearly coming to a standstill, investors are likely to hold cash in the form of US dollars.