EUR slide to mid-1.01 range reverses – Scotiabank

The EUR slumped to 1.0150 in early Asian trade but has since stabilized in the low/mid-1.02 range. President Trump made it clear that tariffs are coming for the EU as well in the not-too-distant future, Scotiabank's Chief FX Strategist Shaun Osborne notes.

More losses look likely ahead

"The tariff threat is likely to bolster expectations for easier ECB policy in the months ahead, given the implications for EU growth. Eurozone Manufacturing PMI data for January was revised up (to 46.6, from 46.1) on upwardly revised (but still soft) German data. Eurozone CPI fell less than expected in January (- 0.3% M/M) to leave inflation a little higher than forecast (2.5% Y/Y, versus 2.4% expected)."

"The EUR’s weekend plunge has also left a gap on the short-term charts that the market may try and fill as the initial move lower moderates. A push to the 1.0300/50 range is likely to draw out renewed selling interest, however. Broader technical risks remain geared to a push under 1.00 and a drop towards 0.95/0.96 in the months ahead."