Just in case you thought it was safe to tiptoe back into the euro, think again.
That's the word from Valentin Marinov, a currency strategist at Citigroup.
Marinov says a disappointing report on industrial production from Germany, along with downbeat comments from officials there, point to tough sledding ahead for the euro zone's largest economy. And Germany is only the latest country to report economic activity below expectations.
"The latest Eurozone data releases will keep the cyclical headwinds for EUR firmly in place ahead of the regular
That doesn't mean the euro is headed directly south, though.
Marinov expects no surprises from the European Central Bank on Thursday, and "usually, unchanged policy stance tends to support EUR by boosting its rate advantage especially against other low yielding currencies," he says. "We suspect that tomorrow's meeting need not be an exception."
But once investors pass that point, Marinov is more bearish.