EUR/USD Rebounds to 1.1760, Gains Limited by US-Iran Tensions
EUR/USD rebounded to the 1.1760 area on Monday (April 20th) after a weak opening to the week, recovering some of its initial losses. The currency briefly touched a daily low below 1.1730, but its upward movement was held back and it was unable to break through the 1.1770 area, which served as the technical limit for last weekend's movement.
In response, market sentiment remained cautious as escalating tensions between the United States and Iran dampened hopes for a quick resolution to the conflict. Risk appetite weakened after US authorities seized an Iranian-flagged ship, a move seen as disrupting the fragile ceasefire.
On the diplomatic front, uncertainty increased as Iran threatened retaliation and failed to confirm its participation in peace talks scheduled to resume on Tuesday. This prompted market participants to hold off on aggressive positions, limiting the euro's gains against the dollar despite an intraday rebound.
From Europe, German Producer Price Index (PPI) data showed a 2.5% monthly increase in March, the strongest since August 2022. This figure underscores the inflation risks from geopolitical escalation, following strong wholesale price data and higher consumer inflation in several EU countries last week, while also adding pressure on the ECB to consider raising interest rates in the coming months. (asd)
Source: Newsmaker.id
