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21 Feb 2013
Forex Flash: EUR/USD potential downside in the short-term – Danske Bank
The bloc currency continues to grind lower on Thursday, dragged by Wednesday’s FOMC minutes and today’s worrisome prints from the manufacturing/service PMIs to sub 1.3200 levels ahead of the NA session.
Morten Helt, Senior Analyst at Danske Bank, believes that is still too soon to call an end to the recent euro upside, however, in the shorter horizon, the situation may be different.
“In the near term, EUR/USD risks are probably skewed the down side as i) speculation of an early exit from QE, ii) the automatic spending cuts, the so-called sequester, kicks in on 1 March and iii) the threat of a potential government shutdown by 27 March are factors that are likely to reduce investor’s risk appetite and weigh on EUR/USD”, concludes the expert.
Morten Helt, Senior Analyst at Danske Bank, believes that is still too soon to call an end to the recent euro upside, however, in the shorter horizon, the situation may be different.
“In the near term, EUR/USD risks are probably skewed the down side as i) speculation of an early exit from QE, ii) the automatic spending cuts, the so-called sequester, kicks in on 1 March and iii) the threat of a potential government shutdown by 27 March are factors that are likely to reduce investor’s risk appetite and weigh on EUR/USD”, concludes the expert.