The Euro (EUR) is down 0.5% so far in the session, with the euro’s consolidation earlier in the week turning into slightly weaker territory, notes Shaun Osborne, chief currency strategist at Scotiabank.

EUR falls despite some narrowing of short-term EZ/US spreads

“In the absence of data or fundamentals, short-term flows appear to be driving intra-session moves. Note that EZ/US 2Y spreads tightened further today (-147bp, the tightest since mid-2023), suggesting that losses in EUR could pick up again once month-end flows conclude.”

“EUR/USD drift has undercut the near-term uptrend, with spot risk fading slightly to test key near-term support at 1.1100/10. Price action suggests a minor top around 1.12 may have been made by the turn of the week. A break below 1.1100 could see losses extend into the mid-1.10s.”