EUR/USD: A further correction towards the 1.05-1.06 zone is on the table – ING

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EUR/USD continues to trade in a tight range around 1.0400. The pair could reach 1.05-1.06 next week, according to ING economists.

The big dollar story is taking over

“Despite the looming recession in the Eurozone, ECB hawks like Isabel Schnabel suggest it may be premature to ease rate hikes. The market is currently pricing in a 61 basis point hike on December 15 (We expect 50 basis points.) It is clear that the 50 bp vs. 75 bp debate will continue.”

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“In the case of EUR/USD, it still looks like the big dollar story is dominating. We cannot rule out a new correction towards the 1.05-1.06 zone, but we would see these as the best levels before the end of the year. These levels could be seen next week if Fed spokesmen or November US jobs data prove to be the catalyst.”

Source: Fx Street

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