EUR/USD Awaits Catalysts: UK CPI Data and BoE Meeting in Focus
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EUR: Little follow-through buying as yet
EUR/USD is becalmed above 1.09 and waiting for the next significant input. Given a light US and eurozone calendar this week, that may mean that EUR/USD gets dragged around by GBP/USD on the release of UK CPI data tomorrow and the Bank of England (BoE) meeting on Thursday.
EUR/USD has just about held above the 1.0910/30 support levels we highlighted yesterday but really needs to push ahead today to confirm bullish momentum. Otherwise the slightly bearish risk environment and strong dollar narrative can suck EUR/USD back down to the 1.0800/0850 area later this week. However, there seem few catalysts for a stronger euro today and ECB speakers seem unlikely to alter expectations that the ECB may hike twice more by the end of this year.
Elsewhere, we note EUR/SEK is trading to new highs. Investors remain very focused on the Swedish real estate story. Let's see whether Riksbank Governor Erik Thedeen has more to say on this topic when he speaks at 1540CET today. Earlier this month the Riksbank called on Swedish property companies to strengthen their balance sheets.
