EUR/USD: Support at 1.15 is under pressure, scope for a slump to 1.12 – Westpac

The EUR/USD pair continues to trade dangerously close to the 2021-low it set at 1.1529 earlier in the week. Although downside momentum may be lessening, support in the 1.1500 area looks increasingly under pressure and a break could extend towards 1.1200, economists at Westpac report.

Weakening Eurozone expectations to weigh on the euro?

“The surge in energy prices, notably regional gas, is now adding to concerns over supply constraints to weigh on both business and consumer expectations and so EUR has also faltered and continues to pressure range support.”

“It is critical to monitor how investor and broader sentiment develops during the early stages of 4Q and at present that prospects appear to be continuing to weigh on expectations and therefore is likely to weigh on EUR.” 

“Although downside momentum may be lessening, EUR/USD support in the 1.1500 region looks increasingly under pressure and a break could extend EUR/USD slippage towards 1.12 as EUR seeks a base.”