Euro Could Rise as it Looks Undervalued Against Dollar
Dow Jones08-14 15:59
0759 GMT - The euro looks undervalued against the dollar, supporting the case for a moderate appreciation in the coming weeks, ING's Francesco Pesole says in a note. "Our models suggest euro-dollar's short-term fair value sits in the $1.160-$1.1650 area." This is primarily on the back of a tightening in two-year swap rate spreads, he says. That supports ING's positive bias on the euro versus the dollar, although a break above $1.16 looks unlikely in coming days unless the Federal Reserve pushes back against interest-rate rise bets, he says. For now the euro could remain supported above technical support of $1.1500, he says. The euro rises 0.2% to $1.1550.
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