EUR/USD remains steady – Danske Bank

EUR/USD remains steady around the 1.23 mark but new Fed Chair Powell’s testimony on Tuesday could be key in determining whether the recent market reluctance to price the Fed much more aggressively despite inflationary impulses is warranted or not, according to Chief Analyst, Jakob Christensen at Danske Bank.

Key Quotes

“If Powell comes out hawkish, the potential for USD downside would be non-negligible. Possible downside EUR risks loom this weekend with the general election in Italy and the SPD vote on whether to join a coalition government with Angela Merkel.”

“EUR/GBP broke below 0.88 on Friday on positive comments after the UK cabinet discussed the Brexit plan. EUR/GBP might see further downside on renewed Brexit optimism ahead of May’s speech on Friday. Jeremy Corbyn is due to clarify his Brexit policy today. The key support level is seen at 0.8779 (9 February low).”