After several days of trying to break above the $1.25 level versus the US dollar, the euro has begun to fall back.
Market-moving news has been thin on the ground for the single European currency of late, but comments from ECB member Christian Noyer provoked a reaction this morning, although not the one he was hoping for. Mr Noyer said that markets should not doubt the ECB’s determination to act and its capacity to take action within the terms of its mandate, which included watching over the solidity of the eurozone. These ostensibly positive comments caused the euro to drop back quickly, heading back towards $1.23.
Perhaps the comments were viewed in an unsettling light, with the words 'within its mandate' possibly suggesting that not all actions would be open to the bank. Regardless of this, an attempt to break and hold above $1.24 has now been defeated in three separate sessions, suggesting that a target of $1.2150 might be the next stop for EUR/USD.