EUR/USD remains below 1.11 despite US curve inversion, slide in US-German yield spread

  • EUR/USD is flashing red for the third straight day despite the US yield curve inversion.
  • The narrowing of the US-German yield spread is being ignored by the market.
  • Below-Forecast German consumer confidence will likely hurt the EUR.

EUR/USD remains on the defensive below 1.11 ahead of the London open despite the US yield curve inversion and the slide in the US-German yield spread to the lowest level since the first quarter of 2018.

The US yield curve inversion deepened on Tuesday with the spread between the 10-year and the two-year yields falling to -5 basis points, the lowest level since 2007. Curve inversions have preceded US recessions in the past 50 years.

Further, the spread between the US and German 10-year bond yields fell to an 18-month low of 218 basis points.

Even so, the EUR/USD fell 0.10% on Tuesday and closed below 1.11. The price action indicates the market focus has shifted to the prospect of the aggressive European Central Bank (ECB) easing in September.

As a result, the common currency may suffer a deeper drop today. EUR/USD could revisit the Aug. 23 low of 1.1052 if the German Gfk Consumer Confidence (Sep) prints well below the consensus estimate of 9.36. The data is scheduled for release at 06:00 GMT.

An above-forecast data may put a bid under the EUR. The technical outlook, however, would turn bullish only if the pair finds acceptance above the Aug. 6 high of 1.1250. As of writing, the pair is trading at 1.1088, representing marginal losses on the day. 

Technical levels


Today last price 1.1088
Today Daily Change -0.0002
Today Daily Change % -0.02
Today daily open 1.109
Daily SMA20 1.1133
Daily SMA50 1.1205
Daily SMA100 1.1211
Daily SMA200 1.1282
Previous Daily High 1.1116
Previous Daily Low 1.1086
Previous Weekly High 1.1154
Previous Weekly Low 1.1052
Previous Monthly High 1.1373
Previous Monthly Low 1.106
Daily Fibonacci 38.2% 1.1097
Daily Fibonacci 61.8% 1.1105
Daily Pivot Point S1 1.1078
Daily Pivot Point S2 1.1067
Daily Pivot Point S3 1.1048
Daily Pivot Point R1 1.1109
Daily Pivot Point R2 1.1128
Daily Pivot Point R3 1.114



Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD: Bears stepping in below 1.1600, focus on ECB, US GDP

EUR/USD remains under pressure below 1.1600, as the US dollar extends the late Wednesday bids amid broad risk-aversion. Traders turn cautious amid stagflation fears and ahead of Thursday's ECB policy decision and the US Q3 GDP release. 


GBP/USD: Sellers attack 50-DMA on monthly support break

GBP/USD prints a three-day downtrend following the key support break, pressured around 1.3740 during the early Asian session on Thursday. The cable pair broke an ascending support line, now resistance, from September 30 the previous day but refrained from closing below 50-DMA.


Gold remains pressured near $1,800 amid USD recovery

Gold prices surrender the previous session's gains and struggle to defend the $1,800 mark. The US 10-year Treasury yields rebound from the early lower levels to trade at 1.55%, following the upcoming BOJ and the ECB policy meetings on the day.

Gold News

Shiba Inu could surpass Dogecoin after a 700% SHIB price rally in October

Shiba Inu (SHIB) continued its march upward on Oct. 27, with its price hitting a record high of nearly $0.000060 before correcting lower. SHIB rallied by more than 25% to an all-time high of $0.00005959, crossing above its previous all-time high of 0.00005000, according to data from Binance.

Read more

BOJ Preview: Focus on outlook tweaks ahead of general election Premium

Despite the recent depreciation in the yen and rising energy prices, the Bank of Japan (BOJ) is likely to maintain its monetary policy settings on Thursday, as it concludes its two-day monetary policy review meeting.

Read more