GBP/EUR: Will A More Dovish ECB Pull Euro Lower?
  • ECB comments last week triggered a selloff.
  • EUR/USD pulled down after the dollar attracted add-on bids.
  • US monthly job numbers were mixed – failed to start a directional move in the pair.

The EUR/USD fell to a weekly low on Friday after the ECB comments regarding the exchange rates and a marginally stronger dollar after the monthly job number. The pair was able to attract bids below 1.1800 amidst the weakness.

The US headline NFP missed the estimate of an addition of 1.4 million jobs in August and printed a gain of 1.371 million jobs. The slight disappointment in the headline figures was covered by the better than expected fall in unemployment, at 8.4 Percent in August from 10.2 Percent previous.

The US Treasury yields rally helped the dollar on Friday and pulled down EUR/USD, checked by the doubts on the US economic recovery and the pair clawed back 60 pips from the 1.1780 area. The bounce wasn’t continued during the Asian session today, and the pair oscillated in a narrow range in the session.

The US markets are closed due to the Labor Day; the lower volume conditions might lead to the continuation of range-bound trading in the pair on the first day of the week. The upcoming monetary policy update by the ECB on Thursday might also check the action in EUR/USD.

ECB Chief Economist Philip Lane has expressed concerns over the euro-dollar exchange rate by saying that it does matter for monetary policy – traders might see the comment as a sign of further easing by the ECB. Such a scenario will limit any bullish potential in the currency, at least for the short-term.