EUR/USD keeps the bearish outlook intact – Scotiabank

Chief FX Strategist at Scotiabank Shaun Osborne has reiterated the neutral/bearish prospects for EUR/USD in the short term.

Key Quotes

“IMF economists suggested that the ECB was nearing the limit of effectiveness for rate cuts and may have to rely on asset purchases to provide stimulus. We think it likely that the ECB will provide more accommodation at its September meeting”.

“Spot is trading with a slightly softer undertone after repeated failures to extend gains through the 1.1190/1.12 area yesterday”.

“We had though the EUR might make a run for the mid 1.12s but the turn lower risks undermining the rebound seen from sub-1.11 levels late last week and early this week. The 55-day MA at 1.1152 may dictate whether the EUR’s turn lower stops or extends over the course of the session”.