EUR/USD Outlook: Potential Downside Bias Hinges on Fed’s Stance – OCBC

The EUR/USD pair continues a slight descent, with analysts at OCBC Bank examining its prospects. There’s been a shift in market expectations, leaning towards an earlier rate cut in April, with more than 80% probability compared to less than 20% just a week ago.

Given the increased likelihood of an earlier European Central Bank (ECB) cut and persistently contractionary Purchasing Managers’ Index (PMI) readings in Europe, the Euro (EUR) might have a predisposition towards the downside unless the Federal Reserve (Fed) adopts a more dovish stance in the upcoming Federal Open Market Committee (FOMC) meeting.

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