Eurozone heading into recession, sell EUR/USD - BCA
Investing.com - The euro is having a relatively good July when measured against the U.S. dollar, but BCA Research sees tough times ahead for the eurozone, and advises investors to sell the single currency.Despite these gains for the EUR/USD pair, BCA Research suggests investors should adopt a defensive posture regarding European assets as it sees the likelihood of a recession ahead.cut its benchmark interest rates in early June, ahead of the U.S.
“The Eurozone is careening toward a recession. It sports too many vulnerabilities. Hence a shock from the U.S. or China will easily induce a contraction in output and an increase in unemployment,” BCA Research said. “Europe already shows domestic vulnerabilities. The private sector is spending an expanding percentage of its income on debt servicing, while construction activity is plunging, bankruptcies are increasing, and the labor market is stalling,” BCA said.
Investors should “adopt a defensive posture; favor bonds over stocks and defensive names over cyclical ones. Sell EUR/USD,” BCA said, seeing the currency pair falling to parity.Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
EUR/USD corrects in the countdown to Eurozone’s HICP and Fed Powell’s speechEUR/USD edges lower but holds the crucial support of 1.0700 in Tuesday’s European session, correcting down from a more than two-week high near 1.0770 recorded on Monday.
Read more »
EUR/USD gains on US Dollar’s correction and sticky Eurozone service inflationEUR/USD jumps higher to near 1.0770 in Wednesday’s European session after a strong recovery from the round-level support of 1.0700 on Tuesday.
Read more »
EUR/USD stays below 1.0900 ahead of Eurozone Consumer ConfidenceEUR/USD retraces its recent gains, trading around 1.0870 during the European session on Tuesday.
Read more »
EUR/USD hangs near two-week low, below mid-1.0800s ahead of Eurozone PMIsThe EUR/USD pair prolongs its recent corrective slide from the vicinity of mid-1.0900s, or a four-month high touched last week, and remains under some selling pressure for the second straight day on Wednesday.
Read more »
EUR/USD slumps on surprisingly weak Eurozone PMI, upbeat US DollarEUR/USD weakens to near 1.0830 in Wednesday’s European session as the preliminary Eurozone Hamburg Commercial Bank (HCOB) Purchasing Managers’ Index (PMI) report for July showed that Composite numbers unexpectedly eased due to a slowdown in activities in the manufacturing as well as the service sectors.
Read more »
EUR/USD extends upside above 1.0850, eyes on Eurozone GDP, Fed rate decisionThe EUR/USD pair trades with mild gains around 1.0860 during the early Asian trading hours on Monday.
Read more »