EUR/USD: the funda download - Scotiabank

Looking for support at current levels, (1.2200/10) analysts at Scotiabank offered a recap on the euro.

Key Quotes:

"Eurozone preliminary PMI data reflected stronger than expected activity in the French and German service sectors this month and a modest deceleration in manufacturing activity; the Eurozone composite PMI remained unchanged at 55.2, better than the 54,8 expected."

"The EUR slipped steadily in European trade after moving sideways through yesterday's Asian session as Eurozone-USyield differentials widened; 2Y bond spreads reached -301bps, a EUR lifetime record and likely the widest since the 80s at least."

"The EUR has been immune to punitive spreads in recent months but the yield gap may be squeezing EUR positions as the cost of maintaining a short USD position is becoming prohibitive in the absence of a sharper slide in the currency."