EUR/USD: ECB monetary policy is not going to provide any further upside potential for the Euro – Commerzbank

Economists at Commerzbank discuss ECB policy outlook and its implications for the EUR/USD pair.

The resistance towards further rate hikes will increase

A further rate hike at the upcoming June meeting is likely to be expected. However, comments by board member Francois Villeroy that the remaining interest rate hikes will be marginal confirm the view of our ECB watchers that in the period after the next hike the resistance towards further rate hikes will increase.

ECB monetary policy is not going to provide any further upside potential for the Euro.

A return to higher EUR/USD levels would have to be driven by a more cautious outlook for Fed interest rates.

See: ECB unlikely to raise interest rates further after the expected 25 bps hike in June – Commerzbank