Euro Strengthens as Portfolio Reallocation Favors the Currency, Says ING Analyst

Euro Strengthens as Portfolio Reallocation Favors the Currency, Says ING Analyst

The euro continues to benefit from its position as the most liquid proxy for the US dollar, according to ING analyst Chris Turner. In a recent note, Turner highlighted signs of portfolio reallocations that are currently favoring the euro.

Recent eurozone balance of payments data revealed that residents repatriated €40 billion of foreign equity holdings in March, marking the largest inflow since September 2022. This significant movement underscores strong investor confidence in the euro.

Additionally, the equity portfolio flow account remains robust, signaling continued support for the euro. As a result, the euro has risen by 0.5% to trade around $1.1339.

Looking ahead, ING expects the euro to trade within the range of $1.1280 to $1.1380 on Friday, reflecting ongoing positive momentum.