Euro pop quickly fades | Forexlive

The latest pop and drop in the euro is a tough one to explain. It looks like fixing sales in the US dollar the culprit, though the move was unusually early.

WSJ Fedwatcher Nick Timiraos is out highlighting some Cleveland Fed research but I just can’t fathom that’s a market mover.

Cleveland Fed researchers analyze the FOMC’s most recent economic projections. Their model projects the FOMC’s unemployment rate path brings core PCE inflation to 2.75% by 2025

“A deep recession would be necessary to achieve” the 2.1% inflation projection https://t.co/EsstjT0oQ9 pic.twitter.com/3HA5fbkVNj

— Nick Timiraos (@NickTimiraos) February 21, 2023

Whatever the reason for the dollar drop, it’s now largely reversed and the US equity market remains in a deep hole, down 63 points on the S&P 500 and the Nasdaq down almost 2%.

EUR/USD took a look at 1.07000 but has been beaten all the way back to 1.0668.