• EUR/NZD initially gained but gave up ground as a fresh bond selloff and elevated oil prices stoked fears that higher inflation could hurt Eurozone economic growth.
• A fresh jump in oil prices pushed euro zone government bond yields higher, intensifying inflation worries and extending selling pressure on French and Italian government debt amid concerns over elevated public borrowing.
• France has been particularly affected as investors closely assess its debt burden, budget deficit and political outlook ahead of the 2027 presidential election..
• The widening yield spread between German bonds and debt issued by more heavily indebted euro zone countries, including France and Italy, has pushed the euro to its lowest level since May last year.
•Euro zone inflation risks remain tilted to the upside, potentially surpassing already-high forecasts, but ECB policymakers played down near-term rate hike prospects on Thursday, citing reassuring signals from underlying price trends.
• Immediate resistance is located at 2.0051(38.2%fib), any close above will push the pair towards 2.0131(Higher BB).
• Immediate support is seen at 1.9974(Lower BB) and break below could take the pair towards 1.9874(50%fib).
Recommendation: Good to buy around 2.0000 with stop loss of 1.9930 and target price of 2.0100
