SocGen on the euro slide
Societe Generale Cross Asset Strategy Research discusses EUR/USD outlook and notes that there might be a recent pattern for EUR/USD correction following the recent price action in the Chinese Yuan.
"When the Chinese authorities signaled that enough was enough and they didn't want to see further Yuan strength last September, the following weeks saw a significant rise in Treasury yields, a correction in the EUR/USD rally and a broadly stronger dollar.
Chinese policy matters more for global markets than it used to, and Chinese policy moves tend to be decided rather faster than those in the US or Europe.
It's noteworthy that US yields are still rising after the slightly soft payroll data on Friday and an extension of a synchronised move higher in yields and the dollar would be similar to what we saw in September/October," SocGen argues.
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