The Euro reached the lowest levels over the last 36 months. Overview for 02.09.2019

The major currency pair updated the lows of May 2017 and is pretty ready to continue its decline.

Early in September, EURUSD is under quite significant pressure. The current quote for the instrument is 1.0989.

Last Friday, “greenback” improved against a lot of major traded currencies, the Euro in particular. The key reason for such high demand for the American currency is a new phase of trade wars: new tariffs earlier announced by both parties, China and the USA, came into effect on September 1st. They cover a lot of different goods, from technologies to clothing and footwear. Step by step, the wars are switching from politicians to consumers. 

Most likely, this topic, I mean fears of an escalation of mutual import tariffs, will be the most important for market players at the beginning of September. Needless to say that this situation is in favor of the USD. 

This week, investors will focus on the US labor market numbers: the country will release them starting from Wednesday with the ADP Non-Farm Employment Change report for August to Friday with all other important readings. The Unemployment Rate is expected to remain unchanged at 3.7%, while the above-mentioned indicator from ADP may show 159K after being 164L the month before. 

Another report to be closely watched by market players is the Average Hourly Earnings, which may add 0.3% m/m in August, the same as in July. These are good numbers, which may significantly support the USD.