Credit Agricole CIB Research discusses the EUR outlook and maintains the view that dips are attractive medium-term buy, arguing that Italy-related negatives are in the price of EUR by now.
"We expect the ECB to remain on its path of monetary policy normalisation - a process that should start with the end of the bank's balance sheet expansion in December and continue with first rate hikes in more than a decade in 2019.
We continue to see EUR/USD as a policy convergence trade and keep our medium-term positive view. This week's Eurozone data could corroborate that view and help EUR stabilise.
With the Fed less likely to turn more hawkish from here, we further suspect that the risks for EUR/USD could be on the upside going into yearend," CACIB argues.