EUR/USD has carved out a well-defined range between 0.9950/1.0015 amid European Central Bank (ECB) hawks circle. Economists at Scotiabank expect the pair to find a solid floor around the 0.99 area.

EUR-bullish weekly signal from last week’s price action remains intact

“The hawkish drumbeat from ECB policymakers – Holzman, Makhlouf, Guindos in the past few hours – continues. ECB hawkishness may underpin the EUR but it may take a bit more clarity on the energy crunch to drive the EUR higher in the coming weeks.”

“Heavy losses from the 1.02 area earlier this week sustain the broader downtrend in this market and tilt overall risks to the downside in the short run. We note, however, that the EUR-bullish weekly signal from last week’s price action remains intact and this should mean firm support for the EUR on dips to the low 0.99 zone still.”