ING Comments on Euro, Czech Republic's Koruna

06:10 AM EST, 02/02/2026 (MT Newswires) -- This week's central focus is on determining how seriously the European Central Bank views the euro's (EUR) appreciation, said ING.

The fact that EUR/USD is no longer at the much-feared 1.20 level does decrease the chances of any vocal reaction from ECB members, but those were more likely to feature in post-meeting comments or the minutes anyway, wrote the bank in a note.

At this Thursday's ECB policy meeting, there may simply not be enough to trigger a shift in President Christine Lagarde's dislike of discussing exchange rate levels, stated ING.

Equally, the bank doubts markets are pricing in much risk of verbal discontent with the euro's strength, so the bar for a negative euro reaction arguably isn't high.

Eurozone core inflation on Wednesday is expected to edge slightly lower to 2.2% year over year. The bank's economists are expecting 2.3%, but either figure should hardly matter for the euro at this stage. EUR/USD should remain almost entirely an extension of US dollar (USD) sentiment, and if ING is right to believe USD confidence is gradually rebuilding, the bank expects a move to its estimated short-term fair value of 1.770 for EUR/USD sooner rather than later.

This week should be a test for the koruna (CZK), depending on Thursday's inflation figure, according to the bank. EUR/CZK is expected to be in the range of 24.350-400, which is where it should enter Thursday's Czech central bank policy meeting, and ING sees the risk of further upside if its dovish expectations are confirmed.

This would open the way to 24.500-600, added the bank.

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