The Euro (EUR) is weak, down 0.7% in opposition to the US Greenback (USD) and underperforming all the G10 currencies excluding NZD, Scotiabank’s Chief FX Strategists Shaun Osborne and Eric Theoret report.
EUR is underperforming following US/EU commerce settlement
“Markets are responding to information of a US/EU commerce settlement, reached over the weekend, that may see the imposition of a 15% tariff on most US imports from the EU.”
“Whereas constructive for market sentiment and danger extra broadly, the information poses a problem for policymakers on the ECB. The central financial institution’s tone has not too long ago shifted decidedly impartial, shedding a dovish bias that had been tied to commerce coverage uncertainty. We’ll be watching upcoming speeches for clues as to how policymakers will probably be responding to the newest tariff developments.”
“The medium-term bull development stays intact however the RSI’s drift towards the impartial 50 threshold has confirmed the newest near-term shift towards a flat consolidation. Crucially, the EUR continues to commerce effectively above the upward sloping 50 day MA (1.1566). For now, we glance to near-term help at 1.1620 and see resistance at 1.1720.”
