EUR/USD forced below $1.3505
Once again, the driving force behind the move in EUR/USD has been the US side of the equation. This afternoon’s US consumer price index inflation figures have come in below expectations, and this has been enough to finally force the EUR/USD rate below the $1.3505 low that was previously set on 5 June.
This of course, was the day when the European Central Bank president, Mario Draghi, first proposed the targeted long term refinancing operation and negative interest rate on bank deposits. The fact that it has taken over a month and a half for the EUR/USD rate to once again test this level, has no doubt been the cause of many a sleepless night in the Draghi household. At the same time as breaking this June low, it has also traded below the $1.3477 lows set early in the year - around the beginning of February.
As my colleague Chris Beauchamp stated yesterday, a close below the $1.35 level should trigger tests of the $1.34 and $1.33 levels.