EURUSD 1 day
ING Research maintains a bearish bias on EUR/USD into year-end.
“Energy-related news should be more relevant for the euro this week,
with falling temperatures in Europe and the price cap on Russian oil
coming into effect today. Urals grade crude is trading around $10 below
the $60/bbl cap, but Russia has already announced that it would prefer
to trim production rather than sell at the embargo price. OPEC+ has held
production steady and is only scheduled to meet again in February, but
we continue to see risks that a tighter picture in the energy market in
2023 could lead to higher oil and gas sooner rather than later. Given
the high sensitivity of EUR/USD to the eurozone’s terms of trade (which
is primarily driven by energy prices), further upside risks for energy
commodities equal downside risks for the euro,” ING notes.
“This week, some dollar stabilisation could make the EUR/USD
rally run out of steam around the 1.0600/1.0650 area, and possibly lead
to a more sustainable drop below 1.0450/1.0500. We remain bearish on the
pair into year-end,” ING adds.
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