MUFG Research maintains a long EUR/AUD position targeting a move towards 1.67 with a stop at 1.5950.
"The performance of the dollar was more mixed yesterday with notable weakness versus EUR offset by strength versus AUD, NZD and CAD. CHF, SEK and GBP strengthened also but less so than EUR which suggests there was an element of outperformance in European FX," MUFG notes.
"That makes sense to us and indeed in last week, we included a trade idea of higher EUR/AUD reflecting our view that the specific positive euro-zone policy developments had mainly been reflected in a higher EUR/USD rate and that there was scope for EUR to out-perform non-dollar currencies going forward. The EU Recovery Fund; the German fiscal stimulus; and the ECB PEPP increase have all helped to diminish near-term fragmentation risks that can support EUR more broadly," MUFG adds.