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Focus on Powell's testimony, coronavirus headlines 

12 Feb 2020

After Fed Chair Jerome Powell played down the coronavirus impact on the U.S., the EUR/USD pair is trading around the 1.09 region.

Despite exceeding the fresh four-month lows, the pair still remains to be below the 50, 100, and 200 Simple Moving Averages on the four-hour chart whilst the Relative Strength Index increased over 30.

The Federal Reserve chairman said, “There is no reason why the expansion can’t continue,” in relation to the coronavirus outbreak, and emphasised that the bank is closely following the latest developments. Powell will be answering Senators later today after continuing his testimony. 

Moreover, President of the European Central Bank, Christine Lagarde pointed out that inflation is "some distance" below the bank's target, as it continues the strategic review, expected to end in July. 

CPI was forecast to be lower, allowing the ECB to leave their interest rates unchanged. 

Furthermore, the Cable trades around the 1.2950 handle following Carney’s explanation of the coronavirus outbreak. The Bank of England’s Governor Mark Carney expressed optimism about the outbreak. 

The BOE Governor claimed that he is calm over the virus outbreak, after comparing it to the impact that previous ones had had. Carney praised the UK's financial system’s resilience. 

Brexit contoniues to cause problems to the British pound, with negotiations between the UK and the EU set to commence early next month.

Traders are predicting that both sides will reach common ground and agree to a trade deal.