EUR/USD firmer, regains 1.1900 and beyond ahead of Lagarde
- EUR/USD advances further and retakes 1.1900.
- The greenback stays in a corrective mode so far.
- ECB’s Lagarde speaks later before the Parliament.
The buying interest remains well and sound around the single currency, with EUR/USD now hovering around the 1.1900 zone, or daily highs.
EUR/USD bid on risk appetite trends, looks to Lagarde
EUR/USD extends further the rebound from multi-week lows in the mid-1.1800s recorded earlier on Monday, always sponsored by the corrective downside in the buck and sustained by the broad-based improvement in the risk-associated galaxy.
Also collaborating with the upside in spot, yields of the key German 10-year reference manage to gather extra steam and reach multi-day peaks in the -0.17% zone.
Nothing from the domestic docket, while across the pond the Chicago Fed National Activity Index ticked higher to 0.29 in May, surpassing estimates.
Later in the session, Chief Christine Lagarde will speak before the European Parliament.
What to look for around EUR
EUR/USD collapsed to levels last seen in early April well below 1.1900 the figure on Friday, always in response to the strong improvement in the sentiment surrounding the greenback exclusively following the latest FOMC event. In the meantime, support for the European currency comes in the form of auspicious results from fundamentals in the bloc coupled with higher morale, prospects of a strong rebound in the economic activity and the investors’ appetite for riskier assets.
Key events in the euro area this week: ECB Lagarde (Monday) – Advanced EMU Consumer Confidence (Tuesday) – EMU, Germany June flash PMIs – (Wednesday) – German IFO survey (Thursday) – German GfK Consumer Confidence, European Council meeting (Friday).
Eminent issues on the back boiler: Asymmetric economic recovery in the region. Sustainability of the pick-up in inflation figures. Progress of the vaccine rollout. Probable political effervescence around the EU Recovery Fund. German elections. Investors’ shift to European equities.
EUR/USD levels to watch
So far, spot is gaining 0.41% at 1.1910 and faces the next hurdle at 1.1992 (200-day SMA) followed by 1.2032 (100-day SMA) and finally 1.2064 (38.2% Fibo retracement of the November-January rally). On the downside, a break below 1.1847 (monthly low Jun.18) would target 1.1835 (low Mar.9) and route to 1.1704 (2021 low Mar.31).