EUR/USD to extend its rally to 1.0400/1.0450 in the coming days – ING

The risk rally sent EUR/USD back above 1.0300. Economists at ING expect the pair to reach 1.0400/50 in the coming days.

Only a Dollar function

“Some improvement in China-related sentiment is a positive development for eurozone assets and the Euro, but swings in the pair remain primarily a function of broader Dollar moves.”

“The Fed minutes are the most important event for EUR/USD today, along with further changes in the market's sentiment on China.”

“An extension of the rally to 1.0400/1.0450 is surely possible in the coming days, but a return to parity in the next few weeks remains our base case as we enter a challenging winter for the eurozone economy.”