EUR weak and underperforming most G10 currencies – Scotiabank
|The Euro (EUR) is weak, down 0.7% against the US Dollar (USD) and underperforming all of the G10 currencies with the exception of Japanese Yen (JPY), Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
Departing French PM delivers bond market fragmentation
"The departure of French PM Lecornu has sparked renewed concerns about France’s political future, raising the risk of fresh parliamentary or presidential elections, or —at the very least—a new (and likely ineffective) PM. The euro area government bond market is showing signs of renewed fragmentation, suggesting a potential headwind from sentiment."
"In terms of data, releases have been limited to as-expected retail sales data. In terms of the ECB, Chief Economist Lane has confirmed a neutral bias, and President Lagarde is expected to do much of the same at 1pm ET."
"The RSI has tumbled back into bearish territory and the EUR has also breached trend support offered by the 50 day MA (1.1680). The descending trend support drawn from the July highs appears to be holding—for now. We look to near-term support in the mid-1.16s and look to a nearterm range bound between 1.1650 and 1.1750."
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