EUR consolidates below 1.15 – Scotiabank

Euro (EUR) is quietly consolidating within a tight range just below 1.15, holding flat vs. the US Dollar (USD) and treading water in light US-holiday trade, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Communications from the ECB have been largely neutral

"We had noted the absence of any meaningful domestic releases following Tuesday’s ZEW figures, and Wednesday’s Fed meeting offered little to change our bullish EUR outlook."

"Communications from the ECB have been largely neutral, signaling to markets that rates are at, or close to, their terminal levels. Markets are still pricing about one 25bpt cut by year-end, but pricing has softened with about 10bpts of easing eroded since late May."

"The multi-month trend is bullish and momentum is confirming (albeit modestly). EURUSD continues to trade well above the 50 day MA (1.1358), and we look to a near-term range defined by 1.1420 support and 1.1520 resistance."