The euro faces increased downside risk against the US dollar as diverging monetary policy expectations between the European Central Bank and the Federal Reserve widen the yield gap, according to MUFG’s Lee Hardman. EUR/USD has broken below its long-held 1.1400 to 1.1800 range. Softer Euro-zone economic data and easing energy prices are reducing pressure on the ECB to raise interest rates further, while the Fed is priced for multiple hikes.