EUR/USD lost nearly 100 pips on Tuesday and continues to edge lower early Wednesday. In the view of economists at ING, the pair could approach 1.05.

1.05 is at reach

“The euro’s blatant inability to rally on hawkish comments by European Central Bank members (not surprising though given 75bp of tightening by year-end is already in the price) means lingering vulnerability to an external environment negatively affected by an ever-concerning situation in Ukraine and generalised USD strength.”

“The euro could find some support tomorrow as inflation numbers from eurozone countries start to come in, but the chances of 1.0500 being tested by the end of the week have increased.”