MUFG Research discusses EUR/USD tactical outlook and adopts a bearish bias expecting the pair to trade downward in a 1.12-1.0950 range.
"The euro continues to trade close to recent lows against the US dollar with the pair potentially requiring a fresh catalyst to break below support at the 1.1000-level.
The main event risk in the week ahead for the pair will be Fed Chair Powell’s speech at Jackson Hole. If Fed Chair Powell again fails to meet market expectations for more aggressive easing it could encourage a stronger US dollar in the week ahead," MUFG notes.
"In the Europe, the data flow has remained more disappointing although PMI surveys in August surprised to the upside. It keeps pressure on the ECB to deliver a package of easing measures next month which is weighing on the euro. It is too soon to expect a significant loosening of fiscal policy which would be more euro supportive," MUFG adds.