meeting last week was a distinct disappointment for the euro-bears,
but there is a strong risk that the magnitude of the reversal has much
to do with short-term positioning factors and may fizzle into a bout of
range trading. That doesn't apply if we were to get a risk off move or a USD-bearish surprise at next week’s Federal Open Market Committee meeting that further pressures the central bank policy divergence story that has been the chief driver of the EURUSD bear market.Last week’s US jobs report was sufficiently strong, meanwhile, to keep us on track for a Fed rate hike, a hike ironically made even more likely by the dollar’s sharp weakening last week. This week’s US data calendar is rather thin until Friday’s Retail Sales report.Otherwise we have a couple of interesting central bank meetings this week – all on Thursday and starting with the Reserve Bank of New Zealand, where the majority are looking for a 25 basis point easing.
