The USD got cheaper again. Overview for 01.06.2021

EURUSD managed to rise last night, the “greenback” is under pressure from Biden’s budget plans. 

The major currency pair reached stability on Tuesday after a quite volatile Monday evening. The current quote for the instrument is 1.2239.

Yesterday’s trading session was pretty quiet until the evening when financial markets turned their backs on the USD again. 

One of the negative drivers for the American currency was a budget plan offered by the White House and Joe Biden, which implies increasing government expenditures (up to $6 trillion) in the 2022 financial year that starts on October 1st, 2021. At the same time, they proposed to cancel several taxes introduced by the former President, for example, put a corporate tax and a tax on capital gains back to 28% and 39.6% respectively. 

However, capital markets obviously believe that the initiative to remove some taxes will be surely followed by additional taxes for companies and businesses in order to give back gains to the budgets. 

Today’s economic calendar is going to be very busy. In the afternoon, the Euro Area is scheduled to report on the Manufacturing PMI, the Unemployment Rate, and the CPI Flash Estimate for May.

The USA is planning to report on the Markit Manufacturing PMI, the ISM Manufacturing PMI, the Construction Spending, and the ISM Manufacturing Prices. In addition to that, several FOMC members are scheduled to speak. 

All these factors taken together may make the major currency pair extremely volatile later in the evening.