Euro: Testing 1.1300 risk grows against US Dollar – ING
Recent analysis by ING suggests that the Euro is under pressure, with risks mounting towards the 1.1300 mark against the US Dollar. As we observe a strong institutional flow positioned for dollar strength, this aligns closely with our own findings of a bearish sentiment on the Euro. Current market dynamics, characterized by expanding rate differentials and a general USD bullish outlook, underscore why EUR/USD is receiving renewed attention and positioning amidst these shifts.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1700 (median across 11 firms), with UBS at the upper bound (1.2000) and Citi at the lower (1.1300). ING’s recent positioning on the pair resonates with the lower end of this spectrum, reflecting a cautious stance on Euro strength against the dollar.
How firms align
Citi’s target for March 2026 is set at 1.1300, which corroborates ING's bearish view. Meanwhile, firms like HSBC and Deutsche Bank project higher targets at 1.1700 and 1.1800 respectively, emphasizing a divergence in expectations amongst market participants. Please see our /reports/citi and /reports/hsbc for further insights on their stances.
What the data shows
Recent forecast revisions indicate a notable shift, particularly from USB and Danske Bank, which adjusted their March 2026 targets to 1.2000 and 1.1866, respectively. This active recalibration reflects the evolving consensus and warns that significant volatility is likely ahead. Our recent analysis in /research/eurusd-ecb-rate-path highlights the divergence in expectations for EUR/USD as it sits at 1.1401 versus the higher consensus of 1.20.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD risks testing the 1.1300 level as institutional flows favor USD strength.
- 02Focus on the widening rate differentials playing into FX positioning.
- 03Monitor ECB communications and US economic data for catalysts affecting direction.
Market implications
The potential challenge to 1.1300 necessitates vigilance, particularly preceding key US economic reports and ECB meetings. Our consensus number at 1.1700 serves as a benchmark for market sentiment, and breaking through the 1.1300 level could trigger increased selling pressure.
Risks to this view
A reversal of this perspective may occur if economic indicators from the Eurozone outperform expectations or if the Federal Reserve signals a dovish shift in monetary policy. Additionally, geopolitical developments could significantly undermine dollar strength.
Sentiment by currency
USD+EUR-JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
Euro: Bearish bias with scope toward 1.12 against US Dollar – Scotiabank
Scotiabank's 1.12 EUR/USD target implies ~2% downside from current levels, signaling institutional conviction on euro weakness relative to dollar strength.
Euro: Yield gap drives downside risk against US Dollar – MUFG
Widening US-eurozone yield differential creates structural headwind for EUR/USD, reinforcing near-term downside bias.
Euro extends downfall against US Dollar amid firm Fed hike bets
Market repricing higher Fed terminal rate expectations supports USD strength against risk currencies; EUR/USD weakness reflects rate differential widening.
Euro: Dollar strength pushes EUR/USD below 1.1400 – Danske Bank
EUR/USD break below 1.1400 signals dollar strength momentum; monitor 1.1350 support for potential acceleration of positioning.
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