EUR/USD: Plenty of US data coming but unlikely to make noise - BTMU

Matías Salord FXStreet

Analysts from The Bank of Tokyo-Mitsubishi UFJ, have a neutral bias in the EUR/USD pair for next week and warn that risks are to the downside considering that the minutes of the FOMC could strengthen the view of a rate hike.

Key Quotes:

“We set a relatively narrow three big-figure range with a neutral bias for EUR/USD last week (1.1000 - 1.1300) and we see no reason really to change either for the week coming up.”

“There is a pretty heavy economic calendar schedule in the US so there will be plenty of info to help shape monetary policy expectations, starting tomorrow with the retail sales data for July. Then next week we will get the July CPI report and the release of the minutes from the July FOMC meeting. The overall risk is possibly that the markets strengthen the view that the Fed will indeed raise rates this year but we doubt to an extent that will result in any meaningful move lower for EUR/USD.”

“The focus in the foreign exchange market is more on carry and hence if there is any move in FX in the week ahead may be more likely to come in higher yielding currencies versus the dollar that have moved more in recent weeks. EUR/USD stability may well persist through to full trading activities resuming in early September.”

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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