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Oct 08 - 11:55 AM

EUR/USD - COMMENT-ECB Desire For "free Hand" Weighs On EUR/USD Outlook

By Christopher Romano  —  Oct 08 - 09:50 AM

EUR/USD erased overnight gains after accounts of the ECB's latest meeting showed policy makers wanted to keep a "free hand" to deal with uncertainties about the recovery, which could cloud the euro's outlook.

The accounts showed ECB members were concerned about euro strength and weak inflation, leaving markets to interpret a "free hand" as the ability to add stimulus if they need to aid the recovery nL8N2GZ3Q4nF9N2G601J.

Bears took advantage of the message from the ECB accounts to push EUR/USD lower toward the 10-day moving average.

The accounts also helped increase the dollar's yield advantage as German-U.S.
yield spreads widen, which likely adds bear pressure to EUR/USD.

The Oct.
7 daily low and 10-DMA sit at 1.1725.
Should it break a test of 1.1685/95 support is likely.
If risk sentiment should sour bears might drive EUR/USD even lower toward September's monthly low.

For more click on FXBUZ


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Source:
Refinitiv IFR Research/Market Commentary

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