EURUSD extends its recovery since Monday, with the pair seems to struggle around the 1.1280 region that is standing on the way to the 1.13 handle. The euro derives support from a widespread dollar weakness, while the threat of US tariffs on the EU limits the upside impetus.
Interestingly, Istat just announced no change to Italy’s 2019 GDP growth which stood at 0.9%. 2017 GDP growth was revised up to 1.7% from 1.6% previously, while no changes were made to 2017, 2018 deficit-to-GDP ratios. It is somehow positive for the single currency but the problem is that the Italian economy that slipped into a technical recession late last year has yet to see a real recovery from the crisis.
In the short-term, the pair will likely remain in the familiar range, with the price action may get muted ahead of the major events – the ECB meeting and FOMC meeting minutes, both due on Wednesday. So in the coming days, EURUSD could challenge the 1.13 barrier should the Fed disappoint and the European central bank shows no explicit dovishness.