CIBC Research discusses EUR/USD and maintains a bearish bias (1.15 target) on the pair into year-end.
"While the Governing Council spoke with a united voice in September, we expect a more fractious debate in December when the ECB will have 2024 forecasts to consider for the first time," CIBC notes.
"The December meeting is set to witness a discussion on the transition beyond the PEPP regime. The ECB is intent upon maintaining favourable financing conditions to perpetuate the recovery narrative. As a consequence, we expect the central bank to consider PEPP transitioning into the Asset Purchase Programme. Current purchases are €20bn per month. That compares with the ‘‘moderately lower pace’’ of PEPP flows agreed at the September ECB gathering," CIBC adds.