EUR is outperforming on ZEW surprise – Scotiabank

The Euro (EUR) is strong, up 0.4% against the US Dollar (USD) and outperforming all of the G10 currencies on the back of a better than expected ZEW investor sentiment survey. The survey is seen as a leading indicator for German industrial production, leading by roughly 12 months, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret note.

EUR is lifting spreads with added support from ECB comments

"The data are adding to the ongoing moderation in easing expectations for the ECB and helping to deliver fundamental support to the EUR via yield spreads. ECB policymakers are also helping to cement the shift in rate expectations, with neutral messaging from Governing Council members Kazaks and Simkus."

"The Euro (EUR) has broken above the psychologically important 1.18 level, offering little in terms of resistance ahead of the July 1 high at 1.1829. The RSI is bullish, at 61, but still shy of the overbought threshold at 70. We see little in terms of resistance between the July high and the 1.19 level. We look to a near-term range bound between 1.1750 and 1.1850."