18 Feb 2015
EUR/USD range-bound, awaiting FOMC minutes – TDS
FXStreet (Barcelona) - Shaun Osborne, Chief FX Strategist at TD Securities, notes that EUR/USD is range-bound as USD looks broadly in line with its fundamental fair value, waiting for FOMC minutes to the set the tone for rate expectations and fuel strength in the dollar and US yields.
Key Quotes
“EURUSD is lower but remains range bound. Neither rising US yields, with the 10-year bond rate reaching 2.15%, nor the backwards and forwards between deadlocked Greece and the EU appear to be fazing investors to any great degree at this point.”
“EURUSD remains resolutely range bound between 1.13/1.15.”
“We think the USD looks broadly in line with fundamental fair value at this point—which rather suggests more range trading until we get additional information.”
“Today’s FOMC minutes will provide some colour on the Fed’s outlook at the start of the year (and the level of concern about “external” developments especially) but it is Chair Yellen’s congressional testimony next week that is likely to set the tone for rate expectations in the US as we move towards mid-year and the take-off in rates which policy makers tell us is coming but markets appear reluctant to price in.”
“Further gains in US yields relative to the majority of the rest of the developed world will be a strong source of support for the USD but it is not clear that spreads can widen much more at this point without stronger evidence that the Fed is getting closer to tightening.”
Key Quotes
“EURUSD is lower but remains range bound. Neither rising US yields, with the 10-year bond rate reaching 2.15%, nor the backwards and forwards between deadlocked Greece and the EU appear to be fazing investors to any great degree at this point.”
“EURUSD remains resolutely range bound between 1.13/1.15.”
“We think the USD looks broadly in line with fundamental fair value at this point—which rather suggests more range trading until we get additional information.”
“Today’s FOMC minutes will provide some colour on the Fed’s outlook at the start of the year (and the level of concern about “external” developments especially) but it is Chair Yellen’s congressional testimony next week that is likely to set the tone for rate expectations in the US as we move towards mid-year and the take-off in rates which policy makers tell us is coming but markets appear reluctant to price in.”
“Further gains in US yields relative to the majority of the rest of the developed world will be a strong source of support for the USD but it is not clear that spreads can widen much more at this point without stronger evidence that the Fed is getting closer to tightening.”