EUR/USD tops the post-Fed high of 1.1806 and is ready to extend gains

EUR/USD has advanced after weak US GDP and jobless claims and is back above the 1.18 level, up 0.1% on the day. The Fed's gloomy stance and Europe's coronavirus advantage may extend the pair's gains, Yohay Elam, an analyst at FXStreet, reports.

Key quotes

“The US economy fell by 32.9% annualized in the second quarter, better than -34.1% estimated but well within the wide range of expectations. In quarterly terms, the world's largest economy squeezed by 9.5% – and that is better than Germany's contraction of 10.1% recorded early in the day. Nevertheless, EUR/USD is rising.”

“Investors seem to look beyond the second quarter and focus on recent data. Europe is suffering several COVID-19 flareups but is returning to growth. That cannot be said about the US, where weekly jobless claims increased once again. Initial applications rose to 1.434 million and continuing claims are up above 17 million. Even if America gains jobs in July, the prospects are dim as the death toll from the disease is rising.”