The Trump-Putin assembly and any higher readability on the trail forward within the Ukraine battle have longer-lasting implications for the Euro (EUR) than for the US Greenback (USD), ING’s FX analyst Francesco Pesole notes.
Markets could tread rigorously for now
“How EUR/USD, EUR/CHF and EUR/JPY commerce on Monday morning can be an excellent gauge of how markets have digested any headlines from Alaska.”
“The deterioration within the eurozone’s phrases of commerce has impacted the long-term euro honest worth, and a few conviction that vitality costs might come structurally decrease from right here might make markets extra comfy with the euro buying and selling at ranges inconsistent with a comparatively unattractive implied charge – e.g. above 1.20.”
“However as mentioned above, there’s a probability that at the moment is likely to be step one within the route of de-escalation, and markets could tread rigorously for now. The repricing in Fed reduce expectations is hindering the probabilities of one other main leg greater. The subsequent US information releases will decide whether or not a return to 1.180 is possible within the close to future.”
