BOTMUFJ: EUR/USD next week
Analysts at Bank of Tokyo Mitsubishi claim that the bias for EUR/USD is neutral in the near term.
“The recent strength of EUR and rise in euro-zone short rates may place some pressure upon the ECB at their upcoming policy meeting (Sept. 5) to strengthen their commitment to maintain current or lower rates for an extended period. Should the ECB not strike a dovish tone, it could open the door to further EUR upside in the near-term. The release of the US ISM surveys and especially non-farm payrolls report for August next week could prove crucial in determining whether the Fed begins to taper QE in September. If the data disappoints it will weigh upon the USD and vice versa, although the upside risk from stronger data is likely smaller”, says the bank.