EUR: Pendulum swings back to the dovish side
EUR/USD handed back some of its early week gains – seemingly on inflation data that was not quite as bad (high) as expected, and the ECB narrative slowly appreciating the threat of slow-down. This came across in the ECB minutes yesterday and in a speech from the central bank's Isabel Schnabel. These developments took about 6bp out of the expected ECB tightening cycle, widened two-year swap rate differentials and softened EUR/USD.
For today, we will receive some final August PMI numbers for the eurozone although the main focus will be the US NFP data. Unless some soft data can start to see the market reprice a deeper Fed easing cycle in 2024 (it looks like just 50-75bp is priced currently), it looks like EUR/USD will largely trade a range defined by the 100 and 200-day moving averages – at 1.0920 and 1.0815 respectively.
Elsewhere, Switzerland released August inflation data this morning. The Swiss National Bank is still sounding hawkish and is probably still managing the nominal CHF stronger to keep the real CHF stable. EUR/CHF should be comfortable down in the 0.95-0.96 range.
![Turbulent Q2'23 Results for [Company Name]: Strong Exports Offset Domestic Challenges](https://www.fxmag.com/media/cache/main_box_filter/uploads/articles/2022-FXMAG-COM/GPWA/gpw-s-analytical-coverage-support-programme-wse-2-6311cd4191809-2022-09-02-11-30-41-63175bda84812-2022-09-06-16-40-26.png "Warsaw Stock Exchange: Brand24 (B24) - 1Q23 financial results")
![Turbulent Q2'23 Results for [Company Name]: Strong Exports Offset Domestic Challenges](https://www.fxmag.com/media/cache/article_small_filter/uploads/articles/2022-FXMAG-COM/GPWA/gpw-s-analytical-coverage-support-programme-wse-2-6311cd4191809-2022-09-02-11-30-41-63175bda84812-2022-09-06-16-40-26.png "Warsaw Stock Exchange: Brand24 (B24) - 1Q23 financial results")
