EUR: ECB CPI expectations surprise w/ markets still pricing June cut – Scotiabank

Euro (EUR) is soft, down 0.3% against the US Dollar (USD) and a mid-performer among the G10 in an environment of broad-based USD strength, Scotiabank's Chief FX Strategist Shaun Osborne notes.

EUR is soft on the day

"Second-tier confidence data were broadly (albeit marginally) disappointing while the ECB’s CPI expectations figures delivered an unexpected rise. The tone from the ECB has been broadly dovish, and it will be interesting to see (if, and) how these inflation expectations figures are discussed. Markets are still roughly pricing one full 25bpt cut at the June meeting."

"The trend is bullish but momentum is softening, reflecting the nearly three week range that has seen movement bound between support in the mid-1.12s and resistance in the mid/upper-1.15s."