The support from China’s stimulus story waned yesterday, and EUR/USD’s exploration above 1.1200 proved to be very short-lived amid quarter-end USD buying, ING’s FX strategist Francesco Pesole notes.

EUR/USD’s exploration above 1.1200 is short-lived

“We will likely see a bit more range-bound swings around the 1.110-1.120 area in the near term unless US data offers clearer direction to markets. A 2-year EUR:USD swap rate gap tighter than -100bp (now at -95bp) is still arguing against a major correction in the pair.”

“The eurozone calendar is rather quiet today, but there are three key ECB speakers. President Lagarde will give a welcome address at a conference (but may not touch upon monetary policy), while the dovish-leaning Guindos and hawkish-leaning Schnabel are due to speak later this afternoon.”