The ECB's interest rate hikes so far are likely to be increasingly felt in the economy and are slowly being reflected in economic releases. But for now, the hawks have the upper hand – which is supporting the Euro, economists at Commerzbank report.

Hawkish doves

“Comments from ECB Governing Council members continue to be quite hawkish, even from the doves. However, if the upcoming data releases increasingly show that the Eurozone economy is cooling down, the doves in the Council might change their minds and push for a less restrictive stance by the ECB. But clearly, all this remains to be seen.”

“Today's data are unlikely to provide clear signals of an economic downturn yet. We will therefore probably hear more hawkish tones from the ECB's ranks for the time being, which should tend to support the EUR.”