EUR/USD: R is not recovery for the euro

EUR/USD is struggling to recover amid fears of a second wave of infections. Sino-American relations, US inflation, and coronavirus statistics will likely set the pulse, FXStreet’s analyst Yohay Elam reports.

Key quotes

“Erring on the side of caution amid a rising R – the Reproduction Rate of coronavirus – is one of the reasons keeping the euro from rising as Germany's latest statistics have shown that R is at 1.07.” 

“Anthony Fauci is set to testify in front of a Senate committee and warn that easing restrictions too soon may lead to unnecessary suffering and loss of life. His expected message will likely contradict President Donald Trump's optimism about numbers going down ‘almost everywhere’ and urging a return to normal.” 

“The safe-haven US dollar is set to rise amid growing Sino-American tensions and fears of second waves – wherever they happen.

“CPI figures for April will likely show a deceleration in US inflation, driven mostly by falling fuel prices. That may push the Fed to add further stimulus down the line.”