After the US GDP report, the EUR/USD is challenging January's low.

The recent conflict in Ukraine has had a negative impact on financial market sentiment, sending safe havens higher and risk assets lower. Stock markets have turned bearish, with the S&P500 losing around 700 points this year after peaking at 4,800 points in early January, and the decline has been accelerating, with the S&P500 opening with a bearish gap lower today.

EUR/USD has also turned bearish, falling from near 1.15 to now threaten the 1.11 level, which was the low from last month. Geopolitical tensions are always a strong factor in determining sentiment, but the USD is also benefiting from the second US GDP report. Following a slowdown in Q3, the US economy rebounded nicely in Q4.

This second reading revised GDP up to 7.0 percent from 6.9 percent previously, which is helping the USD, along with the FED becoming more hawkish while the European Central Bank remains more cautious. The second US GDP report for Q4 of last year is shown below, and it shows a noticeable improvement.