EUR/USD: ECB monetary policy does not provide any further upside potential for euro – Commerzbank

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Commerzbank economists discuss the ECB’s policy outlook and its implications for EUR/USD.

Resistance to further rate hikes will increase.
Further rate hikes are likely to be expected at the upcoming June meeting. However, comments from board member Francois Villeroy that the remaining rate hikes will be marginal confirm the view of us ECB watchers that resistance to further rate hikes will increase in the period following the next hike.

The ECB’s monetary policy will not provide any further upside potential for the euro.

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

ECB unlikely to hike rates further after 25bp hike expected in June – Commerzbank