Euro: Two month low tests against US Dollar as yields swing – Danske Bank

Danske Research Team notes that EUR/USD briefly touched a new two‑month low near 1.1500 at the start of the week before retracing slightly higher. They highlight concurrent V-shaped moves in global yields and modest curve steepening. They also point to broader FX dynamics, including Norwegian krona underperformance and Swedish krona strength versus the Euro.

Euro pressured as Dollar stays firm

"EUR/USD started off the week by printing a new two-month low whilst briefly touching 1.1500, before retracing marginally higher through the session."

"In the euro area, the June Sentix investor confidence index increased to -13.4 (cons.: -14.6, prior: -16.4), reflecting a slight positive surprise."

"This marks a continuation of the recovery, supported by easing concerns about a significant economic slowdown, with strength in the US and Asia. However, the influence of rising interest rates and recent developments may not yet be fully reflected in investor sentiment."

"The Norwegian krona underperformed peers, likely related to the price action in the oil market, whereas the neighbouring SEK positioned itself as today's winner within G10 FX, with EUR/SEK closing below 10.90."

"In Germany, factory orders fell -3.8% m/m in April (cons: -2% m/m), reversing a revised 4.5% gain in March. The drop was broad-based, reflecting weakness in both domestic and foreign demand. Firms are believed to have brought orders forward in March due to concerns over rising costs and supply disruptions, leading to the decline in April."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)