Euro: Gentle upside against US Dollar as greenback softens - ING
The Euro is currently experiencing a modest upside against the US Dollar, reflecting a broader trend of USD weakness. ING's commentary suggests that this movement may be indicative of a market reassessment regarding Fed policy, a narrative supported by recent shifts in trader sentiment. The nuance here lies in determining whether the greenback's decline is a precursor to a Fed pivot or merely a momentary reprieve in positioning dynamics.
Where it sits in our coverage
Our consensus for EUR/USD sits at 1.1700 for March 2026 (median across 11 firms), with MUFG at the upper end of the range at 1.2600 and Danske Bank at the lower bound with 1.1100. ING's target of 1.1700 aligns with this broader anticipation of positive Euro sentiment relative to the greenback.
How firms align
Notable bullish positions supporting the headline view include Morgan Stanley, which forecasts 1.2000 for March 2026, and RBC, with a similarly optimistic 1.1600 target. These positions reflect an alignment with the broader bullish sentiment towards the Euro indicated by the recent USD softening. For further insights, refer to our past analysis at /research/eurusd-ecb-rate-path-2026-08-20.
What the data shows
Revisions in forecasts have shown a positive shift, with firms like Deutsche Bank upgrading their March 2026 target to 1.1800 recently. Our published research has consistently indicated a mean reversion scenario for EUR/USD, supporting the recent gentle upswing.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD nudged higher at 1.1446 amid USD softness.
- 02Traders should watch Fed communication for hints on policy direction.
- 03Expect volatility around upcoming ECB data and Fed meetings.
- 04Maintain bullish positions as long as EUR holds above 1.1400.
Market implications
Investors should monitor the 1.1500 level for potential breakout signals. Key economic indicators and central bank communications scheduled for next week could further influence the strength of the Euro. Our consensus target of 1.1700 provides a near-term focus for traders.
Risks to this view
A reversal in USD sentiment due to stronger-than-expected economic data or hawkish statements from the Fed could quickly invalidate the bullish Euro outlook. Additionally, any tightening from the ECB would counteract current Euro strength and lead to reassessments of the consensus.
Sentiment by currency
USD EUR+JPY~GBP~Composite USD score: -0.35
Sources & References
How we cover this story
Other coverage on this pair
Euro: Further upside toward 1.1725 against US Dollar – UOB
Technical target of 1.1725 suggests EUR/USD momentum remains constructive; monitor for resistance breakdown confirmation.
Euro gains on hawkish ECB outlook despite firm US Dollar
ECB hawkish signals offset near-term USD strength; watch for EUR/USD support levels as divergence between central bank tightening cycles compresses.
Euro fades below 1.1700 as US Dollar rebounds on yields
USD strength driven by yield repricing narrows EUR/USD technicals; monitor if 1.1700 support caves to reinforce dollar momentum.