FXStreet – Analysts at Bank of Tokyo Mitsubishi explained that the euro has finally broken higher against the US dollar rising back above its average from over the last year at around the 1.1000-level.
Key Quotes:
“Global investor risk sentiment continues to remain fragile creating a more supportive environment for current account surplus currencies like the euro. However, the jump higher in EUR/USD was mainly driven by broad-based US dollar weakness. The US dollar has been undermined in the near-term by heightened concerns over the economic slowdown in the US.
The weaker than expected ISM non-manufacturing survey signalled that the US economy has likely slowed further early this year. It has also cast doubt on the resilience of domestic demand while external demand remains weak.
The US interest rate market has shifted to discount almost no further rate hikes from the Fed this year. The US dollar is likely to remain vulnerable in the week ahead although weakness already appears to have overshot somewhat in the near- term. The release of the non-farm payrolls report for January will be crucial for US dollar performance in the week ahead with risks skewed to the downside.”
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(Market News Provided by FXstreet)