Euro to benefit if risk for China assets increases ?

News

Comments from Deutsche bank on the EUR, with comments on how China risk in linked in:

cyclical picture dim on multiple fronts 

  • trade wars
  • Brexit
  • Italian risks

 DB sees EUR/USD trying to break 1.10 over the summer though not far beyond.

Do not see extended fall for the EUR/USD:

  • European balance of payments continues to be “Japanized” with current account recycling decelerating further this year
  • Second, the Fed has greater potential to ease policy which should eventually be more negative for the dollar
  • Third, the euro is likely to benefit from an unwind of euro funding as well as pricing some “dumping” risk of China assets. 

Not sure on 1 but I see their point on 2 and 3.

ForexLive

Articles You May Like

Canada May ADP employment -16.0K vs +24.0K prior
Recap: Fed’s median dot plots belie more dovish tilt by FOMC members
Investor Karen Firestone: What the pros do when they are underperforming (other than panic)
May Chicago Fed national activity index -0.05 vs -0.45 prior
WTI crude oil futures settle at $57.43

Leave a Reply

Your email address will not be published. Required fields are marked *