EUR/USD nudges above 1.1640 to 12-day highs on broad USD weakness ahead of Thursday’s ECB meeting, widely seen delivering a quarter-point hike to 2.5%.
The Euro attempts to resume its uptrend against the US Dollar on Wednesday’s early European session despite the risk-off mood and high crude prices. EUR/USD is drawing support from USD weakness to hit 12-day highs just above 1.1640, as investors brace for Thursday’s European Central Bank monetary policy meeting.
Euro rallies are likely to remain shallow, with oil prices at their highest levels in the last three months as the Gulf situation deteriorates. On the same session tape: Tehran launched an attack on a US Navy warship and an airbase in Jordan on Tuesday, and the US military responded by targeting several Iranian tankers; Iran-backed Houthi militias attacked oil facilities in Saudi Arabia.
Analysts at Rabobank highlight that the USD’s dithery tone adds weight to a change in FX sentiment, arguing the “Dollar debasement debate which was triggered by US Treasury Secretary Bessent’s bond intervention announcement on August 19 appears to have undermined confidence in the greenback.”
Wednesday’s calendar is thin, with ECB President Christine Lagarde’s speech at the Deutsche Bundesbank in Berlin the main event — she will not speak about monetary policy as the central bank kicks off its two-day meeting, widely expected to end with a quarter-point hike to 2.5%.
Also Oil Asia Brent near $100, CENTCOM five tankers, and Saudi energy halt.
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