EUR/USD: EUR capped again at 1.12 – Scotiabank

FXStreet Insights Team FXStreet

Eurozone Manufacturing PMI was revised up in September to 45.0 (from 44.8) after Spain reported a solid gain and German and French data were nudged up marginally from preliminary reports, Scotiabank’s Chief FX Strategist Shaun Osborne notes.

Soft EZ inflation bolster October ECB cut bets

“Eurozone Manufacturing PMI was revised up in September to 45.0 (from 44.8). But generally soft activity data and weaker than forecast Eurozone CPI today (-0.1% M/M for September) are bolstering expectations that the ECB will cut rates again this month, with 23bps of easing now priced into swaps.”

“Wider EZ/US spreads (2Y bond spreads have widened 20bps since September 18th) have undercut the EUR and reinforced the ceiling on the EUR around the 1.12 area for now.”

“Another strong rejection of the 1.12 area this week leaves the EUR looking prone to a little more weakness at least in the short run. A weak close for the EUR yesterday (bearish outside range session) signals a firm top on the EUR on the daily chart. A push back to the lower end of the recent range to 1.10 (and major support) is likely to develop in the short run.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.