Help center Contact us Register
arrow_forward_24px
Start Trading
Platforms
Trading Platforms
Trading Tools
Products
Markets
Instruments
Best conditions
Personal Finance New
Education
Analytics
About Admirals
Help center
Status Page
Register
menu_24px
  1. Home
  2. Analytics
  3. Trading News
  4. Euro slumps as EU slash economic forecasts

Euro slumps as EU slash economic forecasts

July 07, 2020 13:00

The euro fell against most major currencies as the European Commission slashed its 2020 and 2021 economic forecasts. According to the institution in Brussels, the toll of the coronavirus pandemic will force the 27 EU economies to contract by 8.3% this year, with a modest rebound of 5.8% in 2021.

It was only in May that the Commission forecast a contraction of 7.4% this year, with a rebound of 6.1% in 2021. The slash in economic forecasts is due to the fact the Euro area economy most likely shrank by 13.5% in the second quarter of this year.

In a statement released on Tuesday, Valdis Dombrovskis, the vice-president of the European Commission said: "The economic impact of the lockdown is more severe than we initially expected. We continue to navigate in stormy waters and face many risks, including another major wave of infections."

One major issue for the bloc is the fact the economic recovery is forecasted to be uneven across member states. The International Monetary Fund (IMF) said that France, Italy and Spain could contract by more than 10% this year, with the German economy forecast to contract by 6.3%.

The imbalance in economic terms is likely to create more tensions between member states with diverging policy views. The bloc is currently struggling to find a compromise regarding the coronavirus recovery plan due to diverging views on how to help member states hardest hit by the impact of Covid-19.

The euro fell the most against the US dollar but weakened across most cross rates. Below is the long-term, monthly price chart of the EURUSD available via Admiral Markets on the MetaTrader trading platform.

Source: Admiral Markets MetaTrader 5 SE, EURUSD, Monthly - Data range: from 1 October 2007 to 7 July 2020. Please note: Past performance is not a reliable indicator of future results.

Did you know that you can download the Trading Central Technical Ideas indicator completely FREE by upgrading your MetaTrader 5 trading platform provided by Admiral Markets UK Ltd to the Supreme Edition?

This indicator provides you with actionable trading ideas and technical analysis on a wide range of asset classes. To get it free, just click on the banner below and download it today:


INFORMATION ABOUT ANALYTICAL MATERIALS:

The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter "Analysis") published on the website of Admiral Markets. Before making any investment decisions please pay close attention to the following:

1.This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

2.Any investment decision is made by each client alone whereas Admiral Markets UK Ltd (Admiral Markets) shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.

3.With view to protecting the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.

4.The Analysis is prepared by an independent analyst Jitan Solanki, Freelance Contributor (hereinafter "Author") based on personal estimations.

5.Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis.

6.Any kind of past or modeled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.

7.Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.


Avatar-Admirals
Admirals An all-in-one solution for spending, investing, and managing your money

More than a broker, Admirals is a financial hub, offering a wide range of financial products and services. We make it possible to approach personal finance through an all-in-one solution for investing, spending, and managing money.