USD little changed versus core majors ahead of NFP – Scotiabank

The Euro (EUR) is entering Thursday’s NA session unchanged against the US Dollar (USD) as it continues to consolidate just below Monday’s fresh multi-year high, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Near-term risks lean neutral

"The euro area’s final services PMI offered a modest surprise, printing 50.5 (vs. 50 exp. & prev.). Germany and France also delivered modest surprises but printed readings just below 50, implying modest contraction in the services sector."

"Comments from the ECB have continued to lean neutral and comments around the EUR have highlighted the disinflationary impact of currency strength. Markets are pricing a hold at the next ECB meeting on July 24."

"The bull trend is intact but the near-term risks lean neutral as the momentum indicators peak around overbought levels. Longer-term resistance is limited ahead of 1.19 and the mid 1.22s."