EUR/USD: Energy shock challenges recovery story – ING
ING’s Chris Turner says higher energy prices are forcing investors to reassess optimism on European industry and the Euro. With Investors have been overweight the Euro and European assets, EUR/USD is coming under pressure. ING sees scope for a move back toward the 1.1575–1.1650 area, while any ECB hawkishness may only offer temporary support.
Higher energy costs weigh on Euro outlook
"Higher energy prices will see investors re-appraise their view of a renaissance in European industry. That said, the global economy is in a much better position than it was when energy prices spiked in March 2022 and there is now more fiscal support than there was back then."
"After a relatively contained Asian session, EUR/USD is now starting to come under pressure in early Europe. Investors have been overweight the euro and European assets on the recovery story this year – a story that will naturally be challenged this week by higher energy prices. Unless there is some early de-escalation, EUR/USD can easily get pushed back to the 1.1575/1650 region, with outside risk to the 1.1575/1600 region."
"Investors have been right to question the safe haven status of the dollar this year, but given the nature of this shock (energy), it will be the dollar that benefits the most."
"Look out for a speech from European Central Bank President Christine Lagarde at 3:00pm CET today. It looks too early for the ECB to make a clear judgement on what the weekend's events mean for the inflation profile, but any hawkish remarks could provide some transitory support for the euro."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Ethena Pay Adds Earn+ Through Aave V4 Lending on Avalanche
DoorDash (DASH.US) Outperforms Nasdaq Amid Tech Stock Selloff! Officially Announces $17 Billion Acquisition of Instacart; Will Grocery Delivery and Retail Advertising Drive a Revaluation of Value?
The complete integration of the two major platforms may enhance their overall competitive and bargaining power in terms of delivery economics, consumer reach, and retail media monetization. Grocery retailers lacking their own delivery networks are bound to face more significant bargaining pressure, while Walmart and Target, which own Spark and Shipt, are relatively more capable of withstanding the impact.
Earnings Preview | A 121x P/E Ratio Gamble: If Palantir (PLTR.US) Guidance Is Not “Impressive Enough”, Its Stock Price May Plummet
Palantir released its Q3 earnings after the market closed on Monday. The market expects revenue of $2.18 billion, an increase of about 85%. The focus is on the raised annual guidance and the growth rate of the commercial business. With its high valuation, there is very little margin for error.
BTIG warns: US stocks have entered "uncharted territory," and gold may further decline to $3,500
The low volatility in the US stock market is actually an illusion created by extreme divergence among sectors, with the internal structure being extremely fragile. BTIG warns that the market urgently needs a panic-induced sharp correction, with the Nasdaq facing at least an 8.5% pullback and the S&P 500 potentially dropping to 7,300 points. Additionally, the semiconductor sector has already broken technical support, the AI sector may be adversely affected by election policies, and both gold and silver have already peaked; the true market bottom is still far from being reached.
Crypto prices
More
