The EUR has made solid progress from its mid-week low to approach the US jobs data more or less flat on the week. German Factory Orders data for July were much weaker than expected (-2.9% in the month) while France reported a smaller than expected Trade deficit for the same month earlier today, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Weekly signal is bullish

"Bloomberg’s latest survey reflects a clear view among economists that the ECB easing cycle is over, contrasting with the July survey that anticipated a little more easing. The survey also reflected a slight increase in hawkish rate expectations for later in 2026. Diverging rate policy between the ECB and Fed should constitute a solid source of support for the EUR in the months ahead."

"Spot gains from the 1.16 area seen through mid-week are approach key, short-term resistance at 1.1725, defined by trend resistance that has capped four rallies in the EUR since June. A clear push through the low 1.17 area would be a strongly bullish signal that the EUR rally is resuming. Trend strength oscillators are neutral but tilting bullish on the intraday and daily studies."

"The weekly signal is bullish and the weekly chart reflects steady support for the EUR on dips to the low/mid 1.16s over the past three weeks. Key support is 1.1600/10."