Bias: range-bound, as EUR/XCD sits near the 90-day average and in the middle of its three-month range.
Key drivers:
- Rate gap: ECB policy remains neutral with rates steady, while the ECCB emphasizes macro stability amid slower regional growth.
- Risk/commodities: Oil sits near 30-day highs with notable volatility; firmer oil can lift euro-area inflation expectations and, with risk appetite firming, support EUR.
- Macro factor: ECB advances the digital euro project, which could change how payments work across borders and affect demand for EUR.
Range: EUR/XCD is likely to drift within its three-month range, with limited intraday moves.
What could change it:
- Upside risk: stronger euro-area data and signs of a shift to tighter ECB rhetoric could push the pair toward the upper end of the range.
- Downside risk: renewed energy-price shocks or a softer eurozone outlook could weigh on EUR/XCD.