EUR/USD: Things might get volatile today – Commerzbank

EUR/USD has partially retracted the gains recorded after the US labor market report. Economists at Commerzbank analyze the pair’s outlook.

Lull in data publications in EUR/USD

Focus is likely to remain on speeches by central bank officials. On the Fed side, attention will probably continue to centre on the debate about a further rate step. On the other hand, speeches by ECB members from both camps are also on the agenda, which are likely to challenge the more than three rate cuts priced in by the market until October 2024.

That means that despite a lack of data in EUR/USD things might get volatile today. However, we would also like to point out that the strong reaction last week was a first taste of how the FX market might react if signs of a recession in the US were to emerge – as our economists expect.