30 Aug 2013
Flash: EUR/USD to range after pulling back from top - BTMU
FXstreet.com (Barcelona) - Bank of Tokyo Mitsubishi UFJ strategists note that the EUR/USD rate has pulled back from the top of its recent trading range over the past week reinforcing our neutral bias in the near-term.
Key Quotes
“Heightened investor uncertainty has been supporting both the more liquid currencies of the euro and US dollar likely in part driven by repatriated flows from riskier assets.”
“Recent developments in Syria at the margin support the euro relative to the US dollar given the rise in the price of crude oil which poses an upside risk to inflation which the ECB places a greater weight upon.”
“The recent strength of the euro and rise in euro-zone short rates may place some pressure upon the ECB at their upcoming policy meeting to strengthen their commitment to maintain current or lower rates for an extended period.”
“Should the ECB not strike a dovish tone, it could open the door to further euro upside in the near-term.”
“The release of the US ISM surveys and especially non-farm payrolls report for August could prove crucial in determining whether the Fed begins to taper QE in September. If the data disappoints it will weigh upon the US dollar and vice versa, although the upside risk from stronger data is likely smaller.”
Key Quotes
“Heightened investor uncertainty has been supporting both the more liquid currencies of the euro and US dollar likely in part driven by repatriated flows from riskier assets.”
“Recent developments in Syria at the margin support the euro relative to the US dollar given the rise in the price of crude oil which poses an upside risk to inflation which the ECB places a greater weight upon.”
“The recent strength of the euro and rise in euro-zone short rates may place some pressure upon the ECB at their upcoming policy meeting to strengthen their commitment to maintain current or lower rates for an extended period.”
“Should the ECB not strike a dovish tone, it could open the door to further euro upside in the near-term.”
“The release of the US ISM surveys and especially non-farm payrolls report for August could prove crucial in determining whether the Fed begins to taper QE in September. If the data disappoints it will weigh upon the US dollar and vice versa, although the upside risk from stronger data is likely smaller.”