The Euro is ready to concede to correction. Overview for 22.06.2020

The major currency pair is starting another June week with a correction after a significant “drawdown” last week. 

EURUSD is correcting on Monday afternoon – it’s high time for a rebound since the external background is almost empty and there is nothing interesting in the economic calendar. The current quote for the instrument is 1.1200.

At the end of last week, the US Federal Reserve Chairman Jerome Powell said that the economic recovery wouldn’t be long in coming but might be very complicated. He said that the process would take much time, money, and tension. As a matter of fact, it was not a surprise for anybody but market players became rather concerned after hearing such conservative estimates from Powell, who is usually very careful in this. 

Powell said that economic outlooks were quite unclear and that was scary. However, that's the way it goes when the whole world has to fight the consequences of the stress it hasn’t experienced before. 

Positive news from the labor market that was released last week doesn’t make things any better. It’s quite clear that the US stimulus measures will require more expansion despite 3 trillion USD that were already “pumped” into the country’s economy. There will be enough money, if necessary – the Fed will mint it, no problem. The most important thing is that this money should really be steered into the real sector of the economy.  

This week, there will be several reports from the USA worth paying attention to. Among them is the final report on the country’s GDP for the first quarter, which is expected to show -5.0% q/q, along with the Personal Income and Spending for May. All these numbers may put the USD under significant pressure.