EUR/USD came under bearish pressure on Tuesday and hit its lowest level in three months near 1.0700. The economists of ING They analyze the pair's prospects.
Wider rate spreads and weaker stocks weigh
US CPI data on Tuesday briefly pushed EUR/USD two-year swap rate spreads to the widest levels in 2023. Add to this a sell-off in equities and EUR/USD was understandably pressured.
EUR/USD continues to undo the late 2023 rally and a break below 1.0700/1.0710 opens the door to 1.0660 and possibly even 1.0610. However, with Fed easing expectations repricing more conservatively (and closer to the Fed's own expectations of 75 basis points of easing this year), we suspect that 1.0600/1.0700 levels may be a Good area for corporates to hedge their long exposure to the Dollar or short exposure to the Euro.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
