The Euro (EUR) is quietly consolidating in a tight range and entering Monday’s NA session unchanged from Friday’s close, Scotiabank’s Chief FX Strategists Shaun Osborne and Eric Theoret report.
Markets appear calm in face of French vote
« All eyes are on this Thursday’s ECB and a hold is widely expected, but market participants will be looking to the statement and press conference tone as well as the forecast update. »
« The outlook for relative central bank policy remains a core component of our bullish EUR forecast and yield spreads continue to move higher, offering considerable fundamental support. Near-term risk lies with the French confidence vote, however the impact of recent political turbulence looks to have softened over the past week or so. »
« The EUR’s technicals are bullish following Friday’s break of descending resistance drawn from the July highs. The RSI is also in the mid/upper 50s, offering confirmation to the overall bullish picture. We see no major resistance ahead of 1.18 and look to a near-term range bound between 1.1680 and 1.1780. »