EUR/USD held around 1.1200 on Thursday, capped by an oil rebound and ongoing
bond-market turmoil. The pair remains in a downtrend and looks set for a fifth
consecutive weekly decline, off roughly 3.5% over five weeks. Sovereign bond
sell-offs have put the euro in focus: French borrowing costs have risen above
levels seen during the 2009 financial crisis. Political deadlock in France
prompted the Banque de France governor to say France does not need ECB support,
but the comment did little to ease investor concern. Rising oil adds import-cost
pressure for euro-area oil importers and reinforces expectations that central
banks will keep policy restrictive to curb inflation, helping lift global bond
yields.
