EUR/USD set to move back to the 1.09 area – ING

Thursday's European Central Bank (ECB) meeting was taken as slightly hawkish. Still, an ECB barely matching Fed tightening can not generate a stronger euro. The pair could drift back to the 1.09 level, economists at ING report.

Surge in energy prices has damaged euro's fundamental fair value

“Yet it looks unlikely that an ECB, barely matching Fed tightening, can generate a stronger euro in the face of heavy terms of trade losses. Here we think the surge in energy prices has probably damaged the euro's fundamental fair value.”

“EUR/USD can easily drift back to the 1.0900 area today as markets prepare for Fed tightening next week and peace talks in Ukraine do not seem to be making any progress.”