EUR/USD is rich compared to 1.0800 equilibrium - Scotiabank

Analysts at Scotiabank noted that the final July PMI data showed slightly stronger services and composite readings than the preliminary data but the EUR paid little attention as investors pared positioning in quiet trade.

Key Quotes:

"Eurozone-US 2Y yield spreads have contacted modestly following the US Q2 GDP disappointment but, with the yield gap still near 130bps and within recent ranges, we see no grounds for the EUR to appreciate significantly at this point. In fact, our fair value model still suggests spot is relatively “rich” to our estimated equilibrium (1.08)."