XE Market Analysis: North America – Jan 25, 2019

The Dollar and Yen have traded softer against most currencies, while Euro outperformance has been a side theme, despite a disappointing German January Ifo report. EUR-USD recovered toward 1.1350, putting in some distance from the six-week low seen yesterday at 1.1289. We still expect a downward bias to prevail in EUR-USD given the backdrop Eurozone-slowing narrative. Greater odds for a stronger break to the downside would be seen if there were the partial shutdown in the U.S. was halted, although this is still looking unlikely.