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Jun 18 - 10:55 AM

EUR/USD: 4 Reasons For A Firmer Foundation Around Current Levels - MUFG

By eFXdata  —  Jun 18 - 10:08 AM

MUFG Research discusses EUR/USD outlook and expects the pair to find some support around current level over the coming weeks.

"At the current juncture it is still unclear whether the recent topside break is the start of a more sustainable bullish trend for the euro or just another false break like in March when the EUR/USD hit an intra-day high of 1.1495 on 9th March before falling back into the range," MUFG notes. 

"We believe that there are firmer foundations on this occasion for the euro to strengthen on a more sustainable basis having been encouraged by: i) proposals for an EU Recovery Fund, ii) larger than expected German fiscal stimulus totalling EUR130 billion, iii) the stronger commitment from the ECB to support the euro-zone economic recovery and debt markets by expanding the PEPP by a further EUR600 billion with purchases to continue into the middle of next year, and iv) building evidence that the euro-zone economy is now recovering from the COVID-19 shock as lockdowns ease without any material pick-up in the growth rate of new cases so far," MUFG adds.

Source:
MUFG Research/Market Commentary

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