9 Apr 2015
M&A capping EUR in the near-term? – Westpac
FXStreet (Barcelona) - Robert Rennie of Westpac, believes that EUR/USD might establish above 1.10 in the weeks ahead, but risks exist.
Key Quotes
“EUR remains torn by on the one hand ECB QE and on the other the relentless run of softer US data. We remain of the view that EUR will start to establish a beach-head above 1.10 in the weeks ahead. However, price action post the soft NFP report has left us feeling less comfortable here.”
“Perhaps the Shell/ BG M&A is a factor that is capping EUR in the near term? Time will tell but having traded above 1.10 on 6 occasions since the March 17/18 FOMC meeting, the fact that we cannot hold above that level does suggest there is supply out there.”
“Same for EUR/GBP. We’ve had 4 or 5 attempts above 0.7350, but just cannot hold that level despite the increased focus on the upcoming UK election. So FX price action is certainly not as supportive of our views as say Eurodollar – Euribor spreads have been”
Key Quotes
“EUR remains torn by on the one hand ECB QE and on the other the relentless run of softer US data. We remain of the view that EUR will start to establish a beach-head above 1.10 in the weeks ahead. However, price action post the soft NFP report has left us feeling less comfortable here.”
“Perhaps the Shell/ BG M&A is a factor that is capping EUR in the near term? Time will tell but having traded above 1.10 on 6 occasions since the March 17/18 FOMC meeting, the fact that we cannot hold above that level does suggest there is supply out there.”
“Same for EUR/GBP. We’ve had 4 or 5 attempts above 0.7350, but just cannot hold that level despite the increased focus on the upcoming UK election. So FX price action is certainly not as supportive of our views as say Eurodollar – Euribor spreads have been”