EUR upside potential backed by ECB – Danske Bank

Chief Analyst at Danske Bank Jens Sorensen assessed the recent upbeat tone by the ECB in its minutes released on Thursday.

Key Quotes

“In the majors, the ECB minutes published yesterday clearly showed that the ECB is worried about signalling too much too fast. However, the FX markets remain focused on clues on potential further scaling back of easing over coming meetings, with focus now turning to communication about asset purchases”.

“The ECB has been back and forth in its communication about an exit from monetary easing this year and the risk is now that FX markets are calling its bluff, making it difficult to turn back on the recent more hawkish comments. In our view, this will be key to unlocking the EUR upside potential”.