Euro erases losses as the resilience continues
Euro back above 1.19
No one seems to like the euro as it struggles with another covid wave and an inability to conclude a collective fiscal passage.
Yet someone is buying. EUR/USD has climbed to 1.19 from 1.17 at the start of the month. Today it dipped back to 1.1867 but has rebounded to unchanged. Barring a surprise in the next few hours, it will close near the highs of the week.
We're a universe away from the old days of 1.60 and Gisele Bundchen wanting to be paid in euros but the negative sentiment and reality that eventually Europe will get the vaccine is a recipe for a contrarian trade.
There are also signs that the eurozone is coping with covid better than expected. The surprise index from Citi for the eurozone is currently the highest in the world at +150.