EUR/USD may test the topside on soft US data – SocGen

The Dollar has been falling against everything. Kit Juckes, Chief Global FX Strategist at Société Générale, pens his view on the FX market for the day ahead.

Best to sell the Dollar against EUR, CHF and JPY for now

“If you want to sell the Dollar, EUR, CHF, JPY are a better bet today than NOK, AUD (down more than softish jobs data warrant today), or Latam currencies.”

“Yen is rallying amid speculation that the YCC range won’t be adjusted in the months ahead. This move may need the bond market to join in, to take USD/JPY to new lows, but my underlying view – that the cat’s out of the bag, YCC is doomed, and the yen will be volatile but stronger over time – is unchanged.”

“EUR/USD may test the topside if US claims, particularly if claims, housing starts, permits and Philly Fed data are soft, but not too soft. Though Fed speakers have the chance to push back against falling yields, too.”

“GBP has had a nice short-covering bounce and is now back at levels where EUR/GBP is an attractive buy.”