EUR quiet and tentatively extending last week’s bullish reversal – Scotiabank

The Euro (EUR) is trading quietly in the mid/upper 1.15s as it tentatively extends last week’s bullish reversal.

ECB comments nudge rate expectations higher

"Data releases have been limited to the final German CPI print for October, remaining unchanged from the preliminary at 2.3% y/y. The latest comments from the ECB’s Schnabel have reaffirmed the central bank’s neutral bias while signaling concerns about upside risks to inflation."

"These comments have supported euro area rate expectations, lifting year-end 2026 rates to 2% – a fresh local high. Interest rate differentials are once again pushing higher, offering the EUR a fundamental lift."

"The EUR is tentatively extending last week’s recovery and threatening fresh local highs back above 1.16. The recovery in the RSI is confirming the moves in spot, and currently hovering around the neutral threshold at 50. Near-term resistance is limited ahead of the 50 day MA (1.1662) and we look to a nearterm range between 1.1550 and 1.1650."