Senior Analyst at Danske Bank Jens Pedersen assessed the prospects for the pair in the near term, influenced by Italian politics and upcoming US data.
Key Quotes
“In the majors, EUR/USD will likely continue to be influenced by the developments in Italy”.
“However, today and the rest of the week, the market will also get some hard data to trade on with inflation due in both the US and Euro Area before the jobs report on Friday”.
“In particular, the US data will be important as the market has started to doubt whether the Federal Reserve will deliver another two hikes this year. Note further that EUR/USD FX forwards have also been affected by the Italian woes as the EURUSD CCS basis widened yesterday to as much as -22bp”.
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