EUR starts week with modest gain – Scotiabank

Euro (EUR) is up 0.2% against the US Dollar (USD) and underperforming most of the G10 currencies with the exception of the Canadian Dollar (CAD) and the Swiss franc (CHF), Scotiabank's Chief FX Strategist Shaun Osborne notes.

EUR/USD remains well supported

"The easing in trade tensions should allow markets to shift their focus back to fundamentals and Thursday’s ECB meeting, where the central bank is widely expected to deliver a 25bpt cut in the deposit rate to 2.25%."

"Policymakers’ characterization of risks will important, given that growth headwinds will need to be balanced against the inflation risk related to tariffs. Germany also releases ZEW business sentiment survey data on Tuesday."

"EUR/USD remains well supported and the currency is trading at levels last seen early 2022 threatening a push to 1.15. Momentum is overbought above 70, with an RSI nearing 77. We look to near-term support in the mid-1.12s and resistance in the mid-1.14s."