EURUSD to drift towards the 1.0200 area in the near term – ING

EURUSD continues to edge lower in quiet markets. Economists at ING think a move to 1.02 is on the cards.

PMIs in focus this week

“In addition to the continued wall of European Central Bank speakers, this week will see the advanced November PMIs for the eurozone, Germany and France. The composite PMIs are expected to be in contraction territory for all three and be a reminder that at some point the ECB will probably call time on its tightening cycle.” 

“Our view is that the ECB hikes 50 bps on 15 December (59bp priced in the markets) and then finishes the cycle with a 25 bps hike in February. In other words, we look for the cycle to conclude at 2.25% rather than the 2.90% area priced for the markets in late summer.”

“In the short term, EURUSD has just sunk below support at 1.0270 and we would not rule out it drifting towards the 1.0200 area near term.”