Despite the benign US disinflation story, it is no surprise that markets are not flooding long EUR/USD positions. That has been an already relatively crowded trade, and the recent re-pricing of growth expectations of both growth and rate expectations in the Eurozone is weighing on the Euro’s attractiveness. 

EUR/USD looks likely to keep trading range-bound (1.09-1.11) until signs of a US economic slowdown move the rate differentials back in the Euro’s favour.