EUR: EZ political risk premium to gain in importance - ING

Research Team at ING, notes that the EUR/USD broke below the 1.0800 level for the first time since January 2016.

Key Quotes

“Not only are higher US yields weighing on EUR, but the EZ political risk premium is likely being priced back into EUR (evident on widening EZ peripheral spreads vs German bunds) as both anti-establishment outcomes of the Brexit vote and US elections suggest a greater risk coming from the upcoming busy year-long EZ election calendar. EUR/USD 1.0750 is the next support level to watch.”