EUR/USD continues to drift a touch lower. Economists at OCBC Bank analyze the pair’s outlook.

Market bets have shifted in favour of an earlier cut in April

Market bets have shifted in favour of an earlier cut in April (more than 80% priced vs. <20% probability a week ago). 

The risk of an earlier ECB cut and still contractionary PMI readings in Europe suggest that EUR may be biased to the downside for now unless the Fed takes a more dovish stance at the upcoming FOMC.