EUR/USD remains below 1.08. The economists of Societe Generale discuss the outlook for the pair ahead of the Fed and ECB meetings.
Another move lower is not ruled out if the 1.0860/1.0900 resistance zone turns out to be too long a bridge
At this point, even if a July hike cannot be ruled out and rate cuts are almost fully priced in for the second half, Powell or the dot chart would have to be aggressive enough to prevent 2-year yields and the dollar from falling apart.
Today’s decision should not fall short of what is likely to be a 25 basis point decision by the ECB tomorrow. Taking this into account, the EUR/USD looks well placed to take advantage of early June gains. However, from a technical point of view, the picture is not straightforward and the pair needs to break above 1.0860/1.0900 to move further. A further move lower is not ruled out if the resistance zone proves to be too long a bridge and the ECB triggers profit taking tomorrow.
See – FOMC Forecast: Banks expect the Fed to take a breather, but signal that they will raise rates.
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.
