After a general improvement in market sentiment, following positive signs from Washington hinting at an imminent agreement between Democrats and Republicans on a much-needed US COVID relief package, as well as positive PMI data from China illustrating an ongoing economic recovery, the Euro gained some ground versus the Dollar during early Thursday trading. It is interesting to note that the single currency’s gains relative to the greenback are occurring despite words of caution from the head of the ECB, Christine Lagarde, mentioning on Wednesday the possibility of greater flexibility towards inflation and the release on Thursday morning of slightly disappointing PMI data for Italy and Germany, a sign perhaps of Dollar weakness being, for the moment, the leading narrative behind the pair’s dynamic.
