By FX Empire.com
The EUR/USD continued with choppy trading on Tuesday with the heavy EMU data and focus on the debt crisis, yet the franc was still under pressure from expectations for further interventions.
The pair moved to the upside despite the prevailing euro softness on mounting debt jitters. Investors are eyeing the euro nations with caution and the bond selloff is ongoing with Spanish and Italian bond yields surging and French borrowing costs rising, further agonizing the market.
Nevertheless, despite the ongoing tension and volatility the franc was still fragile versus the euro, especially as it lost grounds against other rivals on expectations that the SNB might take action, especially after UBS projected that the bank will raise the set floor to 1.25 from the current 1.20, which kept the pair biased to the upside for now.
Data from the euro area on Tuesday failed to quell the jitters as well over the deepening debt crisis yet still for the pair was support for the upside. The euro area continued to expand in the third quarter led by Germany and France yet overall the common currency remains pressured by the lingering debt woes.
On Wednesday we expect the pair to continue to fluctuate amid choppy trading with the lack of major data from the euro area and Switzerland and the upside momentum will start to slow for the pair as the expectations for the SNB wane and the euro weakness persists.
The euro area will release the Consumer Price Index for October at 10:00 GMT where it is expected to ease to 0.3% on the month following 0.8% rise while to hold at 3.0% on the year.
Originally posted here
