EUR/USD Upside Losing Conviction and Range-Bound - BTMU
Analysts at Bank of Tokyo Mitsubishi explained that the euro’s attempt
to break higher against the US dollar following the more dovish policy
signal form the Fed has failed in the near-term.
Key Quotes:
"As
a result EUR/USD continues to remain range bound. It is consistent with
the signal from our short-term valuation models whose estimates for
EUR/USD have remained relatively stable in line with the pair’s average
over the last year at around the 1.1100-level."
"We continue to
view the risks as more skewed to the downside in the coming months ahead
of the EU referendum as heightened uncertainty over potential negative
spillovers from Brexit for the rest of Europe should begin to weigh more
on the euro."
"However, the US dollar continues to remain on a
softer footing more broadly which is unlikely to change materially in
the near-term. The latest economic data releases from the US have
reinforced expectations that the economy expanded weakly in Q1. We are
not expecting any significant policy announcement from the ECB at their
upcoming meeting who are likely to reiterate cautious optimism that
recently announced easing measures will prove effective at lifting
inflation."
News provided by: 
