ECB PREVIEW: A HOLD IS WIDELY EXPECTED – TDS
A hold is widely expected for the July ECB meeting. The meeting will not offer much action for the Euro (EUR), and we’re biased towards a weaker EUR, TDS macro strategists note.
FX portfolios are biased towards a weaker EUR
“A hold is widely expected for the July meeting, in line with ECB speak and roughly in-line data. We do not believe the GC thinks a softer tone is needed to keep a September cut on the table. Instead, we expect language to be roughly unchanged relative to June.”
“We don't think the July ECB meeting will offer much action for the EUR. However, we think that G10FX, especially the likes of EUR and the Pound Sterling (GBP), are getting back to attractive fade levels. For medium-term investors, we think 1.09 is a great entry level to fade and, more tactically, we like EUR funded carry trades through July and early August.”
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