Forex Flash: EUR/USD would keep 1.300 longer-term – Danske Bank

The bloc currency is pushing higher on Thursday, hovering over session highs around 1.3035/40 ahead of key data from Germany followed by the ECB gathering. Market consensus remains biased towards a dovish press conference by President Draghi that would weight on the euro.

“Looking beyond the short term, the key risk for the euro is not a 25bp refi rate cut, but a potential deposit rate cut. Given the USD 85bn of monthly QE in the US, a refi rate cut would most likely not be enough to trigger a sustained trend lower and we still expect EUR/USD to trade in the 1.30s and not 1.20s”, assessed K.Kirkegaard, Senior Analyst at Danske Bank.