Breaking: EUR/USD hits fresh five-year lows below 1.0636.

EUR/USD cracks the key support, with more pain in the offing.The US dollar cheers haven demand amid Fed-ECB policy divergence.

Intensifying EU-Russia tensions over energy weigh on the euro ahead of Lagarde.  EUR/USD has finally cracked the 2020 lows of 1.0636 on a sustained basis, now heading towards 1.0600, levels not seen since April 2017.

The unrelenting buying interest seen in the US dollar, as an ultimate safe-have asset, continues to weigh on the main currency pair.Intensifying fears over China’s covid lockdowns and its impact on the global supply chains, re-ignited growth concerns, which keeps the haven demand for the dollar alive and kicking.

Meanwhile, the euro remains weighed down by reports that Russia will cut off the gas to Poland and Bulgaria in a major escalation in the standoff between Moscow and Europe over energy supplies.This comes after the European Union (EU) said it weighs in a cap on the price paid to Russian oil importers, in a way to hit the Kremlin revenues.

On the other hand, EUR traders continue to ignore the hawkish ECB-speak, with policymaker Martins Kazaks having said Tuesday that he prefers the first-rate hike in July after the asset purchase programme (APP) ends at the start of the month.Expectations of a double-dose Fed rate hike in May, as well as, in July underpin the Fed-ECB monetary policy divergence, keeping the buck favored.

EUR/USD rebounds from fresh 2022 lows of 1.0634.EUR/USD is trading near 1.0650, recovering from fresh five-year lows of 1.0634, as the US dollar pauses its upsurge. The greenback remains underpinned by persistent haven demand amid Fed-ECB policy divergence. Intensifying EU-Russia tensions over energy could cap the euro ahead of Lagarde.  

EUR/USD News 

GBP/USD recovers to 1.2600 as USD bulls take a  breather.GBP/USD is recovering to 1.2600, as the US dollar bulls take a breather amid cautious markets. Aggressive Fed rate hikes bets, concerns over global growth and China covid lockdowns favor the safe-haven dollar. 

GBP/USD News 

Gold seems vulnerable near monthly low, break below $1,890 awaited.Gold witnessed some selling during the Asian session on Wednesday and reversed the previous day’s modest bounce from the $1,890 region, or a nearly one-month low. The recent hawkish comments from Powell, reaffirmed expectations for a more aggressive policy tightening by the US central bank. 

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