EUR/USD consolidates around 1.10 – Scotiabank

Euro (EUR) is soft, down 0.4% vs. the US Dollar (USD) and trading back around the 1.10 level with a modest fade of Thursday’s impressive rally, Scotiabank's Chief FX Strategist Shaun Osborne notes. 

Europe’s tariff response awaited

"Sentiment appears to be dominating, as risk aversion permeates the broader market’s tone. Fundamentals remain supportive given this week’s significant narrowing in EU-US spreads as markets appear to be pricing a greater Fed response to tariffs, relative to the ECB." 

"Europe has not yet formulated a response to this week’s US tariff announcement, and EU trade ministers are scheduled to meet on Monday." 

"EUR/USD appears to be consolidating Thursday’s pop. The RSI is just above 70, in overbought territory and near-term price action appears to be settling into a range roughly bound between support in the mid/ upper-1.09s and resistance above 1.11. Additional resistance is expected near the August/ September highs around 1.12."