The EUR/USD is now fully driven by the US Dollar (USD) as political risk in France has been put to one side while news on coalition talks is awaited. The Euro (EUR) can still ‘enjoy the silence’. That will likely remain the case for a few more days, notes Francesco Pesole, FX analyst at ING.
EUR/USD is ready to test 1.0900 soon
“EUR/USD is USD-driven as political risk in France has been pushed aside. EUR may still ‘enjoy the silence’. That will likely remain the case for a few more days.”
“Beyond the very near term, we still believe markets may grow impatient with the political stalemate in France and begin to price in a degree of fiscal risk in the Euro, effectively putting a cap on EUR/USD. On the domestic macro side, things remain very quiet today ahead of next week’s action, which includes the European Central Bank (ECB) meeting.”
“For now, persistent downside risks for the dollar mean that EUR/USD could again attempt to break above 1.0900 soon.”
Source: Fx Street
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