EUR/USD extended its slide and came within a touching distance of 1.0710 before recovering modestly. Economists at Commerzbank believe that the pair is unlikely to see lower levels.

Powell is likely to sound hawkish again

“At present, there is little reason for the Fed to deviate from its current stance. Therefore, central bank governor Jay Powell is likely to sound hawkish again at the Economic Club of Washington today, thus possibly providing a little more support for USD.”

“As the market is maintaining its rate cut expectations for the Fed and as the ECB is also likely to sound hawkish, the scope for lower levels in EUR/USD is limited – unless of course there are further (positive) economic surprises. However, there is no important data due for publication this week.”