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EUR/USD Losses Accelerate, Shows Below 1.13

FOREX
  • Single currency weakness played out further overnight, with EUR/CHF slipping sharply amid thin Asia-Pac trade. Stop-loss selling and option related flow was cited behind the move that drove the cross to 1.0508 - a fresh YTD low, narrowing the gap with major support at May 2020's 1.0505.
  • EUR/USD breaking through the 1.13 handle added to the downside pressure. CHF has slipped off the overnight highs since, with the currency among the weakest in G10 headed into the US crossover. The price action will raise focus on the SNB's FX policy, with markets looking to gauge the bank's tolerance levels for the CHF rate.
  • Elsewhere, AUD trades poorly, with AUD/USD showing through last week's lows as markets responded to wage index data overnight, which showed pay growth well shy of the RBA's cited 3% requirement for rate hikes. Wages grew at a pace of 2.2% - alongside expectations.
  • Canadian CPI and US housing data take focus going forward. Canada's inflation report is seen showing core metrics inching higher still, although trimmed core CPI is seen holding at 3.4%. On the speaker slate, BoE's Mann, ECB's Schnabel and Fed's Williams, Bowman, Daly and Evans are all on the docket.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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