Euro: Upside bias needs close above resistance against US Dollar – UOB
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann highlight that EUR/USD extended modest gains to close at 1.1551, with mild upward momentum still intact. Intraday, the pair may test 1.1565, though a move to 1.1600 is seen as unlikely without stronger momentum.
Rabobank’s Senior FX Strategist Jane Foley has highlighted a modest upside bias for the Australian Dollar (AUD) over the next 12 months, attributing this trend to a softer US Dollar (USD) and expectations of further Reserve Bank of Australia (RBA) rate hikes. Foley notes that AUD/USD has been gradually trending upward since the start of July, primarily due to the weaker USD and the fact that the Australian Dollar is currently in the mid-range compared to its G10 peers.
The key drivers for this outlook include strong labor data and softer Q2 Consumer Price Index (CPI). Although there is a risk of a November rate hike, Foley has raised her 3-month AUD/USD forecast to 0.71 from 0.70. While the AUD's near-term movements will continue to be influenced by RBA policy expectations and inflation risk, today's positive trade data release provides a glimpse into the country's structural economic developments.
However, the immediate impact of this news on the AUD is expected to be overshadowed by the upcoming RBA policy guidance on August 11.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
