EUR/USD

The Euro is continuing to struggle against the US dollar as we enter today’s European trading session failing to capitalize on a round of positive data from Germany amid fears the European currency may have much further to fall.

The latest Industrial Production figures from Germany hit the market earlier today at 0.3 percent versus analysts’ expectations for a figure of 0.4 percent but down from last month’s figure of 0.8 percent.

On an annualized basis, German industrial production fell by 1.1 percent versus a -0.5 percent drop booked previously.

Any positive news from the Eurozone, unless it is super surprising to the upside is unlikely to help the Euro at this time and the continent is heading for a deep recession which has been all but confirmed when Russia shut off the gas supplies on Monday.

The indefinite closure of the Nord Stream 1 pipeline strengthens the difficulties facing eurozone economies and reinforces the view that the eurozone will struggle to keep up with energy supplies this winter.

Some say the US may also face a recession but at a slower speed which means in the medium term, the Euro may suffer and according to some analysts shed another 10c against the greenback.

"The U.S. economy is slowing, but it is doing so at a slower pace versus Europe, which is facing an energy crunch, "In terms of the growth dynamic, growth is going to be faster in the U.S. Even though it will go into recession, I think the eurozone will be sharper." said Gregory Daco, chief economist at global strategy organization EY MoneyWatch.

Looking further ahead today, the main drivers of the EUR/USD currency pair will be the release of GDP figures from the Eurozone when market participants will look for confirmation of the gradual recovery that is currently underway in the Eurozone.

In the American session there will be a monetary speech from Fed board member Lail Brainard which will be closely monitored for any talk of interest rate hikes.