4 Reasons why Euro-to-Dollar Rate Weakness Could Fade: Scotiabank

According to analysts at Scotiabank downside momentum in EUR/USD is lapsing and the pair is unlikely to slide much deeper.

The Euro was close to the bottom of the G10 pack Thursday following another disappointing round of IHS Markit PMI surveys and as markets braced for the outcome of European parliament elections that are now running until Sunday.

The Euro-to-Dollar rate has scope to rise significantly before the year is out but such gains would be unlikely if the Brexit process was to drive another steep fall in the value of Pound Sterling, according to Societe Generale.

The Euro was trading higher against a soft Dollar and range of other rivals Monday but the downmove in the Euro-to-Dollar rate is not yet over, according to analysts at HSBC, who say the trend for the currency will remain to the downside over the coming months.

The EUR/USD has reversed its previous short-term trend and is falling within a medium-term bearish channel.

The Euro ceded ground to a resurgent Dollar Thursday but could have a way further to fall over the coming months, according to the latest strategy note from analysts at Deutsche Bank, who advocate betting against the single currency through the summer months.

The Euro is likely to struggle to gain meaningful upside traction in the near-term as Italian political risks appear to be flaring up once more.

The Euro went higher in mid-week trade on reports the U.S. will delay its "Section 232" tariffs on autos and parts for up to six months, and if officially confirmed the news could put a floor beneath the under-pressure Euro we are told.