Scotiabank cites negative Eurozone-US yield differentials and steady ECB policy as key drivers for the Euro’s decline against the Dollar.
The Euro fell 0.4% against the US Dollar in early North American trading, reflecting renewed weakness amid widening negative yield spreads between Eurozone and US bonds. Strategists point to a hawkish repricing of Federal Reserve expectations while European Central Bank policy views remain unchanged as the primary catalyst.
Technical indicators show the EUR/USD pair in deeply oversold territory, with the relative strength index below 30 and limited support ahead of 1.12. A narrow fair-value estimate based on the 2-year Germany-US yield spread mirrors the recent decline in spot prices. Near-term resistance is seen above 1.1450, with a projected range of 1.1300–1.1400.
The outlook remains bearish as relative central bank policy continues to weigh on the Euro, with Fed hawkishness contrasting stable ECB expectations.