The Euro is under further pressure today against its US counterpart after suffering heavy losses on Friday on the back of strong data from the US and the potential for further falls in the coming days and weeks remains strong.
The latest nonfarm payrolls figure from America hit the market on Friday at 261,000 while the unemployment rate hit 4.1 percent which continues the positive momentum of the employment market.
“The non-farm payrolls report for October provided further evidence that the US labour market remains healthy,” says Lee Hardman, a currency analyst at MUFG.
“Healthy employment growth is resulting in the labour market continuing to tighten as evident by the drop in the unemployment rate to a new cyclical low of just 4.1%.” he added.
The figure being passed around the market at the moment for the Euro/USD is around $1.13 as we head towards the end of the year, which was backed up by last week’s inflation figures from the Eurozone which once again fell short of expectations.
This will leave the ECB no choice but to leave rates on hold for the foreseeable future and unable to cut back on their bond buying program.
On the other hand, the market has priced in a more than 90 percent rate hike from the US Federal Reserve next month which is only going to add the attractiveness of the US dollar and leaving traders wondering where is the value in holding the Euro.