We expect the ECB meeting to keep the single currency under pressure. Our preferred long remains the USD going into the NFP release on Friday where we expect more solid payroll gains and stable unemployment.
Short-EUR/GBP is starting to look increasingly attractive as well.
To the extent that renewed dovishness by the ECB helps prop up market risk sentiment, we could see some renewed interest in EUR-funded carry trades in the wake of the meeting.
With concerns about China still unabated and a Fed lift-off not far away, however, we doubt that a trend reversal lower in the EUR-crosses is on the cards.
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