EUR/USD LOOKS TO LAGARDE, ECB-SPEAK

EUR/USD shrugs off Friday’s bout of weakness and resumes the recovery following the FOMC-led drop to the sub-1.0400 levels at some point during last week.

Monday’s move higher in spot comes in tandem with further correction in the greenback along with the inactivity in the US markets due to the Juneteenth holiday. In addition, the German 10y bund yields keep the range bound theme intact near the 1.70% yardstick.

In the domestic calendar, Chairwoman Lagarde will speak before the European Parliament. Additionally, Board members P.Lane and F.Panetta are also due to speak.

What to look for around EUR

EUR/USD keeps the recovery-mode unchanged and manage to regain the area beyond 1.0500 the figure on Monday.

The resumption of the buying bias comes in response to the offered note in the US dollar, particularly following last week’s interest rate hike by the Fed.

However, EUR/USD is still far away from exiting the woods and it is expected to remain at the mercy of dollar dynamics, geopolitical concerns and the Fed-ECB divergence, while higher German yields, persistent elevated inflation in the euro area and a decent pace of the economic recovery in the region are also supportive of an improvement in the mood around the euro.