Monday saw a rise in the euro against a basket of significant competitors as investors sought to salvage the currency from three-week lows and awaited additional information regarding the direction of European interest rates.
The European Central Bank may decrease interest rates in June, according to some analysts, which may cause the euro to drop below 1.08, while the Federal Reserve might keep interest rates where they are for a lengthy period of time.
EUR/USD
After dropping 0.5% on Friday—the second straight loss—and reaching a three-week low at 1.0801 due to risk aversion, the EUR/USD increased by 0.15% to 1.0823.
Due to fresh worries about the difference in interest rates between Europe and the US, the euro fell 0.75% vs the dollar last week, marking the second consecutive weekly loss.
Negative Prognosis
In a recent note, Scotiabank analysts stated that short-term technical analysis points to a probable fall, possibly below $1.08.
According to the forex analysts at Geoffrey's Group, the EUR/USD pair is ready for a possible decline towards $1.0700.
Forex experts at Crédit Agricole predict that the dollar will perform better than the euro, which is expected to encounter several challenges in the coming days.
Such data-driven headwinds might persuade the Fed to postpone any prospective rate cuts until the second half of the year, while the ECB is under pressure to lower interest rates in June as long as the US economy is still flexible.
