EUR at risk of reacting to other currencies move – Westpac

Tim Riddell, Research Analyst at Westpac, suggests that a lack of hard data releases, other than CPI, over the next week leaves EUR at risk of reacting to other currencies’ moves after EUR’s recent outperformance.

Key Quotes

“The August dearth of official commentators and the lack of decent hard data next week keep the focus on survey data from Germany and the EU. Recent data has been sound, but little more. EUR/USD has drifted from its attempts to reach perceived range resistance in the 1.14s. EUR/GBP has started to retrace some of its post-Brexit gains. Though mostly a GBP adjustment, it is adding the poor price action in EUR.

If data, such as IFO and consumer confidence in Germany and the EU, fail to meet expectations this EUR drift should continue into month end. EUR/USD looks set to slide back towards support in the 1.10-11 area.

EUR/CHF remains painfully range bound. The sharp rebound off the low 0.95s in USD/CHF should allow for it to move towards 0.99 but with little long-term bias.”