ING Analyst Believes Euro Strengthening Will Not Change ECB's Approach

quiet_lurker · 2026-02-14T18:04:32+00:00

Francesco Pesole from ING assesses that strengthening the euro will not change Christine Lagarde's approach to exchange rates. The ECB monitors the euro due to inflation but is not inclined to intervene. However, a rise in the euro could lead to declines if the ECB expresses concerns at the upcoming meeting.

quiet_lurker

2026-02-14 18:04:32

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According to Francesca Pesola, a currency market expert at ING, the recent strengthening of the euro is unlikely to provide enough impetus to influence European Central Bank President Christine Lagarde’s official stance on currency exchange rate changes. Lagarde has repeatedly emphasized that the ECB does not seek to influence exchange rates, but she closely monitors euro movements due to their direct impact on inflation dynamics in Europe.

Recent Declines Have Eased Policymakers’ Concerns

The analyst notes that the previous drop of the euro below 1.20 against the US dollar could have significantly alleviated concerns among central bank leadership. However, in the opinion of the ING expert, the market has not fully priced in the possibility that the ECB might publicly express dissatisfaction with the euro’s overly strong positioning in the currency markets.

Potential Implications for the Euro Exchange Rate

If during Thursday’s ECB meeting the bank chooses to highlight concerns about the euro’s rising value, it could potentially lead to a significant decline in the currency’s exchange rate against major trading partners of the European Union. The analyst views this as a possible move, although the market currently does not consider this scenario as a significant risk in the near term.

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