FOREX
With optimism almost bordering on euphoria dominating sentiment of investors, one would be forgiven for assuming that all is rosy in the real economy; global equities continue to pile up gains and other risk related assets are also approaching pre-pandemic levels. During early Friday trading the euro touched maximums not seen since March 10th, at the start of the debacle caused by the coronavirus fallout. This follows events on Thursday, when the single currency received a massive boost as the ECB announced an increase in its bond purchase scheme of €600 billion, taking the total figure to a staggering €1.35 trillion. The European central bank is using its ‘bazooka’, in a clear demonstration of willingness to do whatever it takes to ensure the single currency will emerge alive from the coronavirus crisis.
EURUSD chart
Ricardo Evangelista – Senior Analyst, ActivTrades
OIL
The general optimism seen on markets is giving further fuel to the rally in oil. There is growing confidence of a swift economic recovery after the Covid19 shock, sustained by central banks’ hyper expansive monetary policies, while the number of new coronavirus infections starts to slow down in many countries.
WTI price (July expiry) is playing with the level of $38 a barrel, while prices are in the middle of the gap left open in March, when a deal between OPEC+ was not reached and coronavirus lockdown started in Italy and other countries, causing a temporary collapse in demand.
Carlo Alberto De Casa – Chief analyst, ActivTrades
