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Thomson Reuters
Oct 30 - 12:12 PM
EUR/USD - COMMENT-EUR/USD Fights Off Economic Blues In Warning To Bears
First appeared on eFXplus on Oct 30 - 10:55 AM

EUR/USD's ability to bounce back from disappointing readings on euro zone economic growth nL8N1XA3CW and Italian funding concerns should send a warning to anyone betting against it. In Italy's first debt auction since S&P assigned a negative outlook, funding yields came in at the higher end of expectations, widening Italian-German and German-U.S.
yield spreads, which in turn weighed on the EUR/USD.
Above-forecast German CPI nL8N1XA5T1 eased the downward pressure on EUR/USD.
Bears may be growing frustrated with their inability to achieve new lows, especially with the dollar currently lacking a new catalyst for gains. That places added emphasis on this week's U.S. jobs report.
Fed funds futures are not pricing in as many hikes as Fed projections imply, so the case for dollar gains needs some support from the upcoming data.
Friday's reading on average earnings will probably
be key if EUR/USD is to break the 2018 low.
If jobs the report disappoints, a 1.1300 break is unlikely and losses from September's high should erode.

chart: Click here

Source:
Thomson Reuters IFR Markets

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