The strong US jobs data swung EUR/USD back under 1.0800 on Friday. Economists at ING analyze the pair’s outlook.
The market still prices a 55% chance of an ECB rate cut in April
It is tempting to say the direction of travel lies to the 1.0700 area, and if so, it will probably be a function of the US side of the equation. From the Eurozone side, the calendar is relatively light.
Given the market still prices a 55% chance of an ECB rate cut in April, there is always a risk of a EUR-positive back-up in short-term rates if that cut is removed. It is not clear this will be the week in which the April rate cut is removed.
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