Forex
EUR/USD Steadies Just Above One-Month Low Amid Supportive Fundamentals
The EUR/USD exchange rate is showing some stabilization just above its one-month low in the mid/lower-1.15s, according to Scotiabank strategists Shaun Osborne and Eric Theoret.
The pair is currently down a fractional 0.1% against the US dollar but holding steady due to supportive fundamentals and hawkish European Central Bank (ECB) rhetoric.
The ECB's hawkish tone has helped maintain stable yield spreads, which are currently near fair value at 1.1625 based on Germany-US 2Y yield spreads alone.
The technical analysis suggests that the 1.15 level remains critical as a break would violate the broader recovery from July, while resistance is identified above 1.16 around the 200-day moving average.