06:05 AM EDT, 04/16/2025 (MT Newswires) -- Eurozone Balance of Payments data is typically not a market mover, but Wednesday's release of the February data could add weight to the story of a rotation out of United States equities and into the eurozone -- as some buy-side survey data suggested at the time, said ING.

The data won't break down what has left U.S. equities, but it should tell investors what has come into eurozone equity markets, wrote the bank in a note. For reference, in the 12 months to January, eurozone residents put 134 billion euros into non-eurozone equity markets. This number should, in theory, fall if eurozone residents are repatriating.

Equally, international investors bought 334 billion euros of eurozone equities over the same period. This number should increase if they -- especially U.S. asset managers -- are increasing their exposure to Europe, helped by the fiscal stimulus news that month, stated ING. If the above turns out to be true, investors should have a little more faith in the EUR/USD rally.

EUR/USD may have already put in a short-term low and be heading back through the 1.1425 area to test 1.1500, pointed out the bank.

Sterling is a little weaker early Wednesday as the United Kingdom services inflation dipped back to 4.7% in March, added ING. At the headline level, the consumer price index has dropped to 2.6% year over year, but the bank believes it could push back to 4% by the end of Q3 on energy prices.

Far more interesting, ING thinks, will be services inflation in April and May. ING believes this could drop still further, even though the Bank of England forecasts a bounce back above 5%. If the bank is right, markets will cement their views of three BoE rate cuts this year -- the next one in May.

EUR/GBP is unwinding some of last week's spike, but a big EUR/USD bull trend suggests EUR/GBP can find some support near 0.85 and a reversal back to 0.86 is likely over the coming months, noted ING. GBP/USD is dominated by the soft US dollar story and has last year's highs of 1.3430 in its sights.

Tuesday's hearing by the future Hungary central bank (MNB) Governor Zoltan Kurali helped the forint (HUF) to make some gains and stave off further depreciation above 410 EUR/HUF. Still, the bank believes HUF is the most globally driven currency within the Central and Eastern European (CEE) region and further recovery in European equity markets pushed EUR/HUF lower as well.

At the same time, this could help on Wednesday again, unless ING sees a change in sentiment, and EUR/HUF could test 407.

Poland's zloty (PLN) and the Czech Republic's Koruna (CZK) rates market saw some return of payers on Tuesday, which helped widen the rate differential a bit, according to the bank. While in the CZK market, ING believes this is the way to go for the days ahead, given the hawkish Czech central bank (CNB), in the PLN market, on the other hand, the start of the cutting cycle at Poland's central bank (NBP) will keep rates tight against the core market.

As a consequence, ING continues to see PLN/CZK moving lower with 5.850 broken on Tuesday and 5.800 on the table for the next two weeks.

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