EUR/USD struggles despite hawkish ECB and rise in EZ yields. The pair may remain better offered for now for three reasons, according to economists at Scotiabank.

Cautious on the EUR’s near-term outlook

“Positioning (markets were long EUR running into the ECB).”

“Risk aversion (higher yields globally are weighing on stocks and lifting the USD).”

“Technical considerations (the EUR was starting to look overbought after its run higher).”

“We are cautious on the EUR’s near-term outlook but remain bullish from a longer run point of view.”