Although our conviction in a lower EUR/USD has grown after the recent rally, this position now carries more risks than in February, when the cross was trading at similar levels.Beyond risks linked to uncertainty on when and why the Fed will hike, we find it useful to highlight EUR/USD risks stemming from the EA side.First, although further selloffs are seen in EA rates as limited, these rates are unlikely to revisit past extreme lows, says Barclays.A higher Eonia curve is here to stay and, with it, higher volatility. Higher volatility in the Eonia curve suggests EURUSD is subject to added volatility from EA uncertainty, volatility in the EURUSD downtrend was driven largely by US factors.
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