Ella 
EUR/USD headed lower for second half of the year on weaker global growth, relative US outperformance – Danske Bank
With bank reserves still at healthy levels, the Fed is likely to continue quantitative tightening (QT) until 2024.
Ongoing quantitative tightening (QT) will weigh on bank reserves over time, but for now, the drain on the Fed’s Overnight Reverse Repurchase Facility (ON RRP) and liquidity support from the Bank’s Term Funding Program (BTFP) Means that tightening liquidity conditions in the short term will not be the focus of market concerns. If anything, the June development was a moderately positive surprise, as evidenced by the narrowing of the EUR/USD OIS base.
Ample USD liquidity may also be a supportive factor for EUR/USD spot, all else being equal, but we still see the cross trading lower in the second half of the year following weaker global growth and the relative outperformance of the US economy.
