EUR: Tied to 1.12, but looking up – ING

The Euro (EUR) has been only marginally impacted by domestic news this week. 1Q growth was revised a touch lower from 0.4% to 0.3% yesterday, although March industrial production figures were stronger than expected, ING's FX analyst Francesco Pesole notes

Bias seems to be for testing 1.130 rather than 1.110

"After a moderate hawkish repricing in the wake of the US-China trade deal, markets and consensus seem to be aligning around two rate cuts by the European Central Bank this year, which is also our call. ECB speakers have so far offered very little pushback against this view."

"This week, members from both sides of the spectrum - like the dovish-leaning Francois Villeroy and the hawk Klaas Knot - sounded confident that US tariffs won’t stoke eurozone inflation. Earlier, Latvia’s Martins Kazaks (hawkish-leaning) said a June cut is a 'pretty possible step'."

"We still see 1.120 as a good short-term anchor for EUR/USD, although the bias seems to be for testing 1.130 rather than 1.110 in the short term on the back of lingering USD strategic selling. We have a one-month target of 1.12 and end-of-June target of 1.13."