Italy budget drama,Euro drops to 17 months low

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Euro drops to 17 months low, Italy budget crises

Tension looming large around declining EURO price, eyeing GDP and CPI revision amidst Italy Budget Drama

  • Tension continuing around Italian Budget drama, keeping the EURO tone bearish.
  • Neither Rome, nor EU are yet prepared to compromise about their demands
  • Incoming reports are unlikely to help the Euro, as market is showing sluggish growth momentum in the Euro Zone

Tension looming large around declining Euro Price

Eur continued to underperform, as it is being traded around 1.1270, while this report is being prepared. EUR/USD, EUR/NZD and EUR/AUD price keep falling and continuing the downtrend streak, as it was in the previous week. Past week, Euro lost ground against five out of seven major currencies and that downtrend path along the slippery slope continues in the Asia Pacific session of today’s market, as EUR/USD nearly lost 0.46% against USD, and it had dropped by 1.66% and 0.92% against AUD and NZD respectively. However, its recent loss against GBP has started to be faded away, as GBP/USD pair is trading below 1.2880 zone.

As the economic calendar takes us in to the mid-November, it seems that the EURO price catalysts have already taken place and the EURO will remain lower in the next couple of weeks. There is growing concern about falling growth momentum and second revision about Q3 Euro Zone GDP report is going to remind the market about the weakness of economic data on EURO front.

Crucially, the Euro Zone CPI data is getting tottered, as price pressure remains well below the ECB target. Inflation expectation has risen in the recent weeks and nothing indicates a calm and steady November for Euro, as Italian budget drama is still continuing.

EUR/USD daily price chart

EUR/USD daily price chart

Bottom Line

The shimmering Italian budget saga failed to ignite its upwind momentum, as EURO keeps falling apart against and its downfall against five out of seven major currencies continues, as EUR/USD pair resides at 1.1270. The European politicians in Brussels still are trying to motivate Roman politicians to cut off budget debts, yet it is much unlikely to happen, in this stand point. As EURO has broken off its key support at 1.1300, a break well below 1.1180 is eyeing and on the flipside, resistance level turns out to be in the 1.1380 region.

Read more on Italian budget saga here

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[Disclaimer: The content of this article is personal opinion and should not be considered as investment advice or suggestion towards any trading activity.]

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