- Cheers the bounce in 10-year German yields, weaker USD amid risk-on and upbeat EU services PMIs.
- Attention turns to US ADP jobs and US ISM services for fresh trading momentum.
Following a brief phase of consolidation around 1.1220 levels in the Asia trades, the EUR/USD rebound picked-up pace in the European session, taking the rates back towards the midpoint of the 1.12 handle.
The renewed strength in the spot is mainly driven by increased demand for the common currency after the German 10-year bund yields jumped back into the positive territory, in response to better-than-expected Euro area services PMI and the bloc’s retail sales reports. Germany’s 10-year yields jumped to fresh weekly tops at 0.005%, up nearly 1% on the day.
Moreover, the persisting risk-on action in the European equities continues to weigh on the safe-haven US dollar and eventually collaborates to the recovery in the major. The risk-on sentiment extends into Europe, as the European trade cheer the latest FT report, citing that the US-China trade talks draw closer to a trade agreement. Meanwhile, the USD index drops -0.33% to 97.03 levels, fresh session lows.
With the Euroland macro news out of the way, the focus now shifts towards the US ADP employment change and ISM non-manufacturing PMI releases for fresh dollar trades, as markets will closely hear the Fedspeak due later in the session ahead.
EUR/USD Technical Levels
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