EUR/USD closely tracks global sentiment, in the opinion of economists at Danske Bank, who see the pair stabilisating in the near-term.
Key quotes
“Recent market stabilisation has clearly been supportive of the spot as markets are arguably front-running economic improvement.”
“Global risk stabilisation near term supports EUR/USD at 1.10-1.12 for now.”
“EU institutional weakness, doubt as to Fed’s reaction function 12M out and virus fears also still make downside risks more pertinent, such that 1.07 will likely act as an anchor and more so than fair-value estimates around 1.20 adding to upside risk.”
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