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Forex pairs in this Article » EUR/USD (Barcelona) - Bank of Tokyo Mitsubishi UFJ analysts are neutral EUR/USD and see spot ranging between 1.3200-1.3500 ahead.

Key Quotes

“The euro is continuing to outperform alongside the US dollar likely supported by
euro-zone residents repatriating funds from overseas.”

“Heightened QE tapering expectations are leading to a significant tightening in global external financing conditions boosting the appeal of the low yielding but more liquid euro and US dollar.”

“The euro-zone’s widening current account surplus also adds to the euro’s relative appeal compared to the US dollar in the current trading environment while the US still runs a sizeable current account deficit although narrowing.”

“Improving cyclical momentum in the euro-zone is helping to support the euro through both raising euro-zone short rates, and to a greater degree through reducing the credit risk of fiscally challenged euro-zone government bonds.”

“In the week ahead, the second release of US GDP report for Q2 may impact Fed QE tapering expectations.”

“The report is expected to reveal a significant upgrade to the initial estimate of Q2 GDP driven primarily by the drag from net trade being revised away.”
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