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### - POV - Aug 29 rally to $1.2070.....>

EURO-DOLLAR
MNI (London)
EURO-DOLLAR: ### - POV - Aug 29 rally to $1.2070 driven by post Jackson Hole
reaction to ECB Draghi comments on EZ growth outlook, as well as failure to
mention concern over Eur strength. Corrective pullback gained pace as market
viewed reaction as overstretched, and with stronger than forecast US ADP and
positive revision in US Q2 GDP released Wednesday, acted to press Eur/Usd to an
extended low of $1.1867. Usd strength also aided by talk that Hurricane Harvery
effects could prompt a resolution to US Govt debt ceiling(although maybe
temporary) and Trump calls for Usd repatriation of offshore earnings. End month
flow expected to provide moderate Usd demand. Ahead of end month fix we have EZ
Flash CPI. Stronger than forecast Germany and Spain CPI could provide for a
stronger show in EZ data. If this proves to be the case it will switch attention
back away from US Balance Sheet trimming to next week's ECB meeting (Sep7) and
speculation that tapering will be discussed. However, we have US NFP/AHE Friday
(US holiday Monday). FX normally focuses on one event at a time and switches
attention once that interest concludes, at the moment there are several focal
factors in play with headline react likely to switch that attention. 
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com

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