FXStreet (Córdoba) – The USD strengthened in response to the FOMC statement yesterday but opened this morning. However, Shaun Osborne, Chief FX Strategist at Scotiabank thinks USD strength is warranted overall, especially versus the EUR.
Key Quotes
“The Fed appears more at ease with the global backdrop –suggesting that recent policy action by the PBoC and the strong hint of more easing to come from the ECB has reduced concerns that were evident in the September FOMC statement”.
“We think the onus is on the US data to stop the Fed from moving in December now so we have to expect the USD to be highly sensitive to data –especially the next two NFP reports –that sway the debate one way or the other”.
“With the prospect of a Fed hike a little clearer and more easing widely expected from the ECB, we continue to think EURUSD is at risk of a sharp tumble, despite today’s rebound”.
“US yields pushed higher yesterday and Eurozone-US spreads – which correlate strongly with spot at the moment – continue to move against the EUR. Two-year bond spreads have widened beyond -100bps. We think modest EUR/USD rebounds from here are a sell”.
(Market News Provided by FXstreet)