Anna 
The EUR/USD pair continues to exhibit a slight downward drift, influenced by evolving market sentiments. Analysts at OCBC Bank delve into the pair’s outlook and note key factors impacting its trajectory.
Recent market dynamics indicate a shift in favor of an earlier cut, with April emerging as a probable timeline. Over 80% of market participants are now pricing in the likelihood of an earlier cut, a notable increase from the less than 20% probability recorded just a week ago.
The looming risk of an earlier European Central Bank (ECB) cut adds to the prevailing pressure on the euro. Coupled with ongoing contractionary Purchasing Managers’ Index (PMI) readings in Europe, the overall bias for the EUR/USD pair appears tilted to the downside.
The analysts suggest that unless the Federal Reserve adopts a more dovish stance at the upcoming Federal Open Market Committee (FOMC), the euro may continue to face headwinds. The delicate balance between central bank policies and economic indicators is likely to shape the short-term trajectory of the EUR/USD pair. Traders and investors are advised to monitor the evolving dynamics in both the Eurozone and the United States for a comprehensive understanding of the currency pair’s movements.
