Synopsis:

Nomura remains cautious on the euro relative to other G10 currencies and has closed its short EUR/AUD position, realizing a small profit.

Key Points:

• Cautious Outlook on EUR: Nomura continues to hold a cautious view on the euro, despite acknowledging the current momentum in EUR/USD.
• EUR/USD Movement: While they expect EUR/USD could move higher due to USD weakness, they believe there are better trades to capitalize on this trend.
• Closure of EUR/AUD Position: Nomura closed its short EUR/AUD trade for a small profit but continues to monitor it, given the perceived economic divergence between Europe and Australia.
• Economic Concerns: The firm believes that economic momentum in the euro area is softening, which could influence future currency movements.

Conclusion:

Nomura is taking a cautious approach to the euro, focusing on more favorable trades elsewhere. While they have closed their short EUR/AUD position, they remain attentive to potential opportunities driven by economic divergence.