Euro Stabilizes After FOMC Volatility Amid Hawkish ECB Policy

The Euro has posted a small gain against the US Dollar as it attempts to stabilize after the Federal Reserve's latest meeting, according to Scotiabank strategists Shaun Osborne and Eric Theoret.

They note that relative policy expectations between the European Central Bank (ECB) and Fed are stabilizing, with ECB policymakers remaining hawkish due to energy-linked inflation concerns and growth. German PPI surprised to the upside in recent releases.

The EUR's momentum indicators remain bearish but look to be stabilizing just above oversold levels. This suggests limited additional weakness from current levels.