Bias: range-bound, current EUR/DKK sits near the 90-day average and in the upper half of the 3-month range.
Key drivers:
- Rate gap: ECB policy remains neutral to mildly hawkish on inflation; Denmark cut rates in 2025 to defend the peg, keeping the gap modest and EUR/DKK tethered to euro moves.
- Oil trends higher and more volatile; energy costs continue to influence euro-area inflation, which can sustain euro strength, yet the peg dampens large moves against the krona.
- Macro factor: ECB advances the digital euro project, eyeing issuance by 2029; this supports euro policy credibility and could influence cross-border settlement and hedging activity.
Range: likely to drift within the recent channel, with a bias to test the upper end only if euro positives persist; the Danish peg keeps any break contained.
What could change it:
Upside risk: stronger euro-area data or a hawkish ECB signal could push EUR higher against the krona.
Downside risk: renewed Danish rate cuts to defend the peg or unexpected euro weakness from global events.
