Trcihet’s hint of a pause in rate cuts last week sent EUR/USD surging but Bank of Spain governor Ordonez is calling BS, saying if inflation comes in below target, the ECB will continue to cut. We’re setting up for an interesting period on the ECB governing council as the Germanic camp may find itself seriously outnumbered by members from countries on the rbrink of deflation.
EUR/USD rallied with EUR/JPY in Asia as equities rebounded there but it has since drifted back onto the 1.39 handle. The economic calendar is light today with just the Chicago Fed national activity index due for release at 8:30. Last month it was at -1.06.