Credit Suisse stays neutral on EUR/USD in the near-term.
With now less than one week to go, and with north of 60 million US voters reportedly having already cast their vote, it goes without saying that the “time decay” on the possibility of an upset in market expectations ahead of 3 Nov is set to rise very sharply. Some might argue that this dynamic was already in play earlier this week, when the news of resurgent Covid momentum in Europe and in the US, combined with the failure of US fiscal stimulus negotiations, yielded limited impact in FX," CS notes.
"Notably, EURUSD in particular remains within range, with rising concerns about lockdowns in continental Europe potentially offset by ongoing expectations of USD weakness as the most likely post-election structural theme. We do not see this changing in the near-term: we continue to target the pair in a 1.16-1.20 range and remain biased to not fade moves towards the top end of the range," CS adds.