ING: The EUR

Our models still suggest EUR/USD should be trading above 1.140. Clearly, the latest moves in bond markets, equities and oil all suggest against aggressively bucking the dollar uptrend. But we feel this week could bring some stabilisation after a decline that looks a bit overdone. The highlight of the week in the eurozone is inflation data for September. Country releases start tomorrow with Spain, and eurozone-wide numbers are due Friday. Headline CPI should accelerate on energy prices, but we expect core inflation to inch only O.lppt higher to 2.5%, confirming there's no sign of second-round effects. Still, we doubt that will be enough to drive the European Central Bank to a more dovish stance. Policymakers still seem to prefer keeping market pricing hawkish as long as energy prices remain elevated. The closer we get to the October meeting, the more impactful ECB speakers can be on markets. With data not exactly screaming for another hike just yet, pricing relies significantly on short-term guidance. Today, we’ll hear from President Christine Lagarde, and from many other ECB officials during the week. We have a preference for EUR/USD to inch back higher and stabilise just above 1.1