Euro: Support firms with hawkish ECB pricing – Scotiabank
Scotiabank’s Shaun Osborne and Eric Theoret highlight that the Euro (EUR) is higher against the US Dollar (USD), supported by strong euro area Producer Price Index (PPI) and firmer European Central Bank (ECB) rate expectations. Markets now price more than one 25bp hike by year-end.
BNY's Geoff Yu highlights Eurozone asset resilience, citing steady composite PMI readings and improving German demand. He notes upcoming talks between Friedrich Merz and ECB officials, ahead of the bank's rate decision, with markets anticipating a 25bp hike. Merz will discuss Germany's economic prospects, as Berlin ponders backing Bundesbank President Joachim Nagel for potential ECB leadership.
While Euro area composite PMI remained steady at 52.0 in August, Germany's services PMI fell slightly to 49.7, indicating marginal contraction. Underlying demand improved, with new business rising and export orders increasing. Price pressures were stable but elevated, and business confidence held steady. USD/JPY tests 156.00 amid hawkish expectations and intervention risks, while AUD/USD struggles with poor Australian trade data.
Gold holds its bid tone, below $4,450, while US bond yields slide on soft ADP report and energy price concerns.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
