EUR/USD is holding near the middle of its overnight range, around 1.1090, as markets await Friday's Jackson Hole speech by Fed Chair Powell, which could pose significant risks to the euro after Wednesday's FOMC minutes release came out less dovish tack than markets expected. Currently, the market is pricing nW1N24C01M in at least two more Fed rate cuts by December 2020, with FEDWATCH on Eikon showing -59bps of easing by the Dec meeting.
If Powell clings to his mid-cycle view on rate adjustments, EUR/USD should slide to new 2019 lows and the effects of a stronger USD, akin to a rate U.S. hike, will be seen as slowing the U.S. economy -- but also muting global growth. For now, significant options interest between 1.1000 and 1.1200, Click here
EUR Chart: Click here