The outcome of the elections in Germany disappointed investors, as they did not bring the unequivocal victory of the party to Angela Merkel and her political allies. This puts the keeps the question open on the eurozone reform in the spirit of "neo-liberalism".

Market participants are disappointed with the outcome of the elections in Germany, which was clearly manifested in their actions. Since Monday, the main European stock indexes are in "red", reflecting this concern. Also, the single European currency remains under pressure that explains the growing uncertainty in the euro area with the outcome of the elections in Germany on the wave of increasing Euroscepticism in Europe. The situation in Greece remains to be an additional problem. The country is still a debtor and cannot get out of its economic problems. On the wave of events that are taking place in Europe such as Catalonia's relentless attempts to secede from Spain and the overall growth of Euroscepticism, this brings concern that the result of the elections in Italy on May next year will be even more devastating for the unity of the eurozone.

Another "problem" of the euro is the slowdown in inflation, which seems to have already had an impact on the ECB. On Monday, the president of the ECB for the first time in several months reported that the European economy still needs significant stimulating measures. After this statement, the euro was under pressure and this decline continued on Tuesday.

Observing what is happening in the euro area, as well as the ECB's likely decision to leave the current monetary policy unchanged, it can be assumed that the fall of the single currency will continue. It can be assumed that the EUR/USD and EUR/GBP currency pairs may be promising in this respect. The decline of the first pair is based on the weakening of the euro against the background of the above reasons and the additional strengthening of the dollar due to the expectation of a rate hike in December. On the other hand, the depreciation of the second pair will be supported by the increase in expectations of a rate hike by the Bank of England before the end of the year.

Forecast of the day:

The EUR/USD pair has overcome the support level of 1.1875, which from a technical point of view opens the way to 1.1690. This arises amid the growing skepticism among investors due to the fact that the ECB will decide in the current situation to radically change its economic course.

The EUR/GBP pair fell below the level of 0.8780, which may lead to a further decline towards 0.8650.