- ECB President affirms that rates could stop being negative by the end of the third quarter.
- The euro rises on all fronts and the dollar collapses.
- EUR/USD at highs in almost a month, near 1.0700.
EUR/USD picked up yet another boost on Monday with comments from the chair of the European Central Bank (ECB), Christine Lagarde on interest rates. The pair climbed to 1.0687, the highest level since April 26. It is trading at the 1.0670 area, with a daily profit of over a hundred pips.
Dollar weakness + Lagarde
The EUR/USD had been advancing on Monday against a general backdrop of dollar weakness and a better mood in the markets. In Europe, the main markets rise on average 0.40% and Wall Street futures 0.60%. This environment puts downward pressure on the dollar, which is falling on all fronts.
The US Dollar Index (DXY) is down 0.80% and is at 102.20, the lowest in almost a month. At the same time, Treasury bond yields remain stable, with the 10-year rate at 2.82%. and that of 30 years in 3.02%.
EUR/USD’s advance accelerated on Lagarde’s statement that they are likely to be in a position to exit negative interest rates by the end of the third quarter. This could lead to a rally as early as July. These words triggered an advance of the euro throughout the entire market.
The EUR/USD had a technical boost with the break of 1.0610, which has now turned into relevant support, and before that is 1.0635. To the upside, if you continue with the rises, the next resistance is at 1.0700, and then 1.0755 will follow.
Technical levels
Source: Fx Street
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