Yield spreads are narrowing in a EUR-supportive manner - Scotiabank

Ross J Burland FXStreet

Analysts at Scotiabank explained that there are no major releases scheduled ahead of Friday’s flash PMI’s, leaving the near-term focus centered on headline risk and Brexit negotiations.

Key Quotes:

"Bullish CFTC EUR positioning has climbed to a fresh multi-year high, at levels last seen in 2011."

"Yield spreads are narrowing in a EUR-supportive manner, measures of implied EUR volatility are softening, and risk reversals are showing a modest premium for protection against EUR strength with the 3 month close to flat and longer-term measures showing a slight (eroding) premium for protection against weakness."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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