A Supreme Court ruling against Trump-era tariffs could marginally support the USD while improving global risk sentiment, favouring high-beta currencies such as the AUD and NZD. Despite signs of short-term undervaluation, EUR/USD remains exposed to a move toward 1.1600, while unusual EUR/DKK forward activity points to speculative positioning and possible Danish central bank intervention, ING's FX analyst Francesco Pesole notes.

EUR/USD undervaluation persists but downside risks remain

"We think the initial reaction of a SCOTUS ruling against Trump’s tariffs could have a slightly net positive impact on the dollar. At the same time, we think high-beta activity currencies like AUD, NZD could be favoured on the back of a more optimistic view of global trade. The euro, which benefited hugely from the initial tariff chaos, may face a bit more pressure if tariffs are paused."

"While EUR/USD is starting to show a rather substantial short-term undervaluation, the downside risks these days extend to the 1.1600 support in our view."

"We are still monitoring EUR/DKK, where some unusual action in forwards suggests both speculative selling of DKK given Greenland headlines and potentially some drying up of liquidity as the Danish central bank may be intervening. Still, it’s worth reiterating that the pair is trading less than 0.2% above the 7.460 peg, and the central bank has ample reserves firepower to buy DKK before resorting to a rate hike."