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Flash: EUR/USD has a bullish bias – BTMU

FXstreet.com (Barcelona) - Bank of Tokyo Mitsubishi UFJ analysts believe that EUR/USD has a bullish bias and is set to range between 1.2800 and 1.3100 through the week ahead.

They note that there are no major events on the horizon in the week ahead but there will be plenty of sentiment readings to give an indication of whether business and consumer confidence is rising in line with the improving financial market conditions. They note that the German IFO sentiment index will be released tomorrow and euro-zone M3 money supply data will give a clearer picture on whether private sector credit has improved. Further, they add that Euro-zone economic, industrial and consumer confidence reports will be released on 30th May.

On the US side, they note that real GDP (2nd estimate) for Q1 and consumer confidence will be watched closely ahead of the key data the following week. They write, “With no major events or data next week the markets are likely to digest further the JEC and FOMC minutes. Our sense is that possibly the foreign exchange market has over-extended its dollar buying over the short-term and we may see the EUR/USD rate gradually drift back toward the 1.3000 level.”

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