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12 Mar 2015
EUR/USD falling quickly towards parity – BTMU
FXStreet (Barcelona) - Lee Hardman, Currency Analyst at Bank of Tokyo-Mitsubishi UFJ, maintains a bearish bias on EUR/USD for the week ahead, with Fed expected to raise expectations for the mid-year rate hike in its upcoming meeting the EUR will continue to slide.
Key Quotes
“The euro is likely to remain under downward pressure against the US dollar in the week ahead. The market has parity firmly in its sights now and there is little left in the way of technical support between the current spot rate and parity.”
“The widening divergence monetary policy between the ECB and the Fed is likely to be highlighted again at the upcoming FOMC meeting. The Fed is expected to signal it remains on course to gradually begin raising rates from around the middle of this year.”
“Dropping the signal that it can be “patient” before normalizing policy is likely to encourage higher short-term US yields supporting a stronger US dollar.”
“In contrast the ECB’s aggressive easing is proving increasingly successful at both lowering nominal and real yields in the euro-zone and weakening the euro.”
“Investor sentiment is also being soured at the margin in the near-term by the high implementation risks surrounding the recent agreement in principle to extend financing support to Greece.”
“EUR/USD – Bearish Bias – (1.0300-1.0800)”
Key Quotes
“The euro is likely to remain under downward pressure against the US dollar in the week ahead. The market has parity firmly in its sights now and there is little left in the way of technical support between the current spot rate and parity.”
“The widening divergence monetary policy between the ECB and the Fed is likely to be highlighted again at the upcoming FOMC meeting. The Fed is expected to signal it remains on course to gradually begin raising rates from around the middle of this year.”
“Dropping the signal that it can be “patient” before normalizing policy is likely to encourage higher short-term US yields supporting a stronger US dollar.”
“In contrast the ECB’s aggressive easing is proving increasingly successful at both lowering nominal and real yields in the euro-zone and weakening the euro.”
“Investor sentiment is also being soured at the margin in the near-term by the high implementation risks surrounding the recent agreement in principle to extend financing support to Greece.”
“EUR/USD – Bearish Bias – (1.0300-1.0800)”