Recent PMI readings from the eurozone have led money markets to assign a 50-50 chance for a 25 bps rate hike by the ECB by year-end, a drop from a prior likelihood of around 85%. Contrastingly, expectations regarding the Fed remained stable, with traders still foreseeing 13 bps of further tightening this year. The rate differential still favors the USD, which hasn’t yet been fully reflected in the euro’s spot levels. Bloomberg’s economic indexes reveal the US outperforming the euro area while concerns about China and a potential energy crisis continue to loom.