EUR/USD rose more than 100 pips on Thursday, after the European Central Bank (ECB) was decidedly hawkish, and was last seen trading at its highest level since mid-January near 1.1450. Economists at OCBC Bank expect the pair to extend its grind higher to test the year-high at 1.1483.

Upside extension

“The surprisingly hawkish ECB was the clear impetus for the outsized gains in the EUR. However, whether this is a head fake or a medium-term change in the ECB’s stance remains to be seen. For this to be a sustained pivot in terms of the EUR’s trajectory, we need the ECB to continue with hawkish follow-ups.” 

“For now, momentum is on the EUR’s side, and the pair will target the year-high at 1.1483.” 

“Support at 1.1380/00 for now.”