FXStreet (Guatemala) - Analysts at Rabobank explained that economic data releases over the past week have predominately brought bad news.
“Chinese credit growth, Japanese machine tool orders, Eurozone Q2 GDP and US retail sales data all had the effect of signalling to the market that it might be some time yet before the world’s most major central banks dare to tighten monetary policy conditions”.
“The EUR has been one of the poorest performing developed world currencies over the past month as fears of continuing weak growth in the Eurozone emphasises the ECB’s threat of further monetary policy accommodation”.
“By contrast, and despite the setback offered by this week’s soft US retail sales report, the USD has been the second best performing developed currency after the NOK since the middle of July. While we expect EUR/USD to trend lower medium-term, we still expect the pace of USD gains to be moderate and constrained by a dovish FOMC. That said, in recognition of the USD’s recent strength we have revised down our 12 month forecast for EUR/USD to 1.28 from 1.30”.