EUR: 1.20 not far, but not straightforward either – ING

The 1.20 level is within reach for EUR/USD, but it’s mostly US factors that hold the key to the next move, ING's FX analyst Francesco Pesole notes.

Upside risks for EUR/USD remain high

"Our baseline scenario is actually that EUR/USD will settle just below current levels (around 1.15-1.16) as markets' dovish bets prove misplaced, but we concede that upside risks for the pair remain high before the data endorses our view."

"Markets will likely wait until Monday’s German numbers are published to draw any conclusions for the European Central Bank. Speaking of the ECB, we’ll hear from three Governing Council doves today: Francois Villeroy, Olli Rehn and Piero Cipollone. Let’s see whether the drop in oil prices triggers some pushback against the hawkish repricing in the EUR curve."