EUR/DKK Outlook: Slightly weaker, but likely to move sideways, as the rate is near its recent average and lacks a clear driver.
Key drivers:
• Rate gap: The European Central Bank is maintaining a neutral policy while Danmarks Nationalbank recently cut rates to align with the ECB, which keeps the DKK pegged to the euro.
• Risk/commodities: Recent oil prices are above average, which could support the euro and impact overall economic conditions in the Eurozone.
• One macro factor: Ongoing geopolitical tensions, particularly related to the Ukraine conflict, may weigh on the euro’s performance, contributing to mixed signals in the market.
Range: The EUR/DKK is expected to hold steady within its recent trading range, with less volatility anticipated.
What could change it:
• Upside risk: A significant improvement in Eurozone economic indicators, such as a strong ZEW report, could boost the euro against the krone.
• Downside risk: Further tariff threats from the US could create additional pressure on the euro, leading to a potential decrease in its value.
