Euro: Rangebound against US Dollar as volatility sinks – ING

ING says EUR/USD volatility has continued to decline, with one-year realized volatility at 5.8%, matching November 2024 lows. The firm sees little reason for this calm environment to change before mid-September, when central bankers return from summer breaks. ING also warns that European investors with US assets may be underhedged and could need to raise dollar hedge ratios if the US dollar weakens again. For the day, EUR/USD is expected to remain confined to a narrow 1.1515-1.1560 range, suggesting limited near-term directional movement and a subdued FX market backdrop.