EUR/USD fluctuates in a relatively tight range above 1.0150. However, the pair is set to continue its move downward, economists at MUFG Bank note.

Short-term spreads dragging EUR/USD lower have further to run

“The reality is that the fundamental backdrop for EUR remains negative and short-term spreads dragging EUR/USD lower has further to run.” 

“We view there is a much greater risk of the ECB delivering less than the current OIS pricing implies – 115 bps compared to the risk of the Fed underdelivering the 125 bps priced by year-end.”