EUR/USD Little Changed Overnight

EUR/USD is essentially flat at ~$1.1835 ahead of European trade. This comes after bulls managed to benefit from the ADP-driven downtick in the broader USD on Wednesday, although the rate remains within the confines of the recently observed range.

• In terms of local news flow, Wednesday saw focus fall on ECB commentary, with Bundesbank chief Weidmann reiterating his well-defined hawkish views re: inflationary dynamics. Elsewhere, governing council member Stournaras highlighted his belief that the jump in inflation will be transitory, while he stressed that the trajectory of wage growth is not yet following inflation. We also heard from governing council member Vasle who underscored the idea that the central bank is not "ignorant" to the risks of high inflation. Data releases saw a miss for German retail sales and a pretty much in line with flash estimate final reading for the Eurozone manufacturing PMI survey.
• Our technical analyst notes that Wednesday's push above $1.1845 extends the current recovery for EUR/USD, with any sustained hold above the 50-day EMA ($1.1827 today) set to improve the footing of bulls. Bulls initially target yesterday's high ($1.1857). If they force a break there, focus will shift to the July 30 high and key resistance ($1.1909). Conversely, the Aug 27 low ($1.1735) provides the most meaningful level of initial support.
• There isn't anything to be aware of in terms of notable FX option expiries come today's 10AM NY cut. Meanwhile, tomorrow's cut will see the following expiries: $1.1865-85 (EUR1.5bn)
• Thursday's local docket is pretty thin, with Eurozone PPI data due.