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• The EUR/USD currency pair reached a two-week high at 1.0700 and finished the week with minimal gains.
• Sentiment soured on a default by the Silicon Valley Bank in the US, based on the risk of spillover in the sector.
• US jobs data was mixed but flashed signs of cooling down.
• Germany’s inflation was unchanged, warranting further tightening by the ECB.

The EUR/USD currency pair rose 0.45% late in the New York session during a volatile Friday, as Wall Street blamed losses in the financial sector on a US bank's collapse. That overshadowed the long-awaited US jobs report, which was scrutinized by investors as the US Federal Reserve noted that it would increase rates faster. At the time of writing, the EUR/USD currency pair exchanged hands at around 1.0639.

Risk Aversion Failed to Bolster the US Dollar Amidst a Potential Bank Crisis in the US

The US cash equity markets appeared to finish the week on the back foot. US regulators seized the Silicon Valley Bank (SVB) after the institution failed to raise capital to meet its requirements. That sent shockwaves across different asset segments, as worries for a spillover increased.

Aside from this, the US Department of Labor revealed the February Nonfarm Payrolls report. Figures exceeded forecasts of 205,000, and came in at 311,000.

Even though the headline made a case for a stronger US dollar, if one were to delve into the details, it would appear that the Unemployment Rate edged to 3.6% vs. 3.4% estimates, a sign that the labor market is cooling. Average Hourly Earnings increased by 4.6% year-over-year, below 4.7% estimates.

On the Eurozone front, Germany reported inflationary data at 8.7% year-over-year, which was unchanged from the previous month. The Harmonised Index of Consumer Prices (HICP) rose 9.3% year-over-year, cementing the case for further tightening by the European Central Bank.

EUR/USD Technical Levels

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