EUR/USD: 1.0850-1.0930 looks to be the short-term range – ING

EUR/USD continues to trade in very narrow ranges. Economists at ING analyze the pair’s outlook.

The Eurozone data calendar is light today

1.0850-1.0930 looks to be the short-term range and we do not see a local catalyst for a breakout until Wednesday’s release of the flash PMI readings for August. 

As to tightening expectations, the market only now prices in 20 bps of rate hikes by the turn of the year – probably underestimating the chance of a 25 bps ECB rate hike in September.