As Francesco Pesole, ING currency strategist, notes, the US presidential debate did not cause any shock to the EUR/USD pair, but it did provide it with enough short-term support that it returned to the 1.105 level yesterday after a tender session.

EUR/USD could return to 1.110

“The next few days will help shape the FX market reaction to the debate more clearly, but overall we remain positive on EUR/USD remaining supportive throughout the US election, and the rising perceived likelihood of a Harris win supports that view.”

“Looking ahead to this week, EUR/USD will continue to be driven entirely by US events as US CPI is due and markets could place more US election trades, but tomorrow it will all be about the ECB meeting. A 25bp rate cut is all but guaranteed, but as discussed in our ECB Cheat Sheet, there is room for EUR/USD to rally on a hawkish EUR rate revaluation early on.”

“In our view, the net effect of the presidential debate, US CPI and ECB announcement could see EUR/USD return to 1.110 by the end of the week.”