EUR/USD risks further decline near term – Danske Bank

Allan von Mehren, Chief Analyst at Danske Bank, assessed the prospects for the pair in the short-term horizon.

Key Quotes

“EUR/USD was under pressure yesterday following somewhat weak German regional inflation figures and the Fed’s Powell coming across slightly on the hawkish side during the Q&A in the US House after a reasonably balanced introductory statement”.

“Indeed, markets had become somewhat complacent regarding the Fed response to the US economy running on all engines, including the fiscal one, and the correction in Fed pricing and USD was warranted, in our view”.

“Today, focus is likely to be on digesting Powell and on eurozone inflation figures; we still see risks on EUR/USD to the downside going into this weekend’s political events in the Eurozone”.