06:28 AM EDT, 07/18/2025 (MT Newswires) -- The European Commission's (EC) two trillion euros budget proposal has continued to face harsh criticism from Germany. with the prime minister admitting it will be a "tough fight over the budget for the next two years," said ING.

The possibility that EC President Ursula von der Leyen's proposal will secure unanimous approval without being materially watered down looks very slim, wrote the bank in a note to clients.

That was, anyway, meant to be a long-term topic for the euro, which for now continues to track United States developments amid dormant European Central Bank rate expectations, stated ING. However, next week's ECB policy meeting may prove less dull than expected. A cut is highly unlikely given recent communication, but tariff risks and a strong euro could revitalise a dovish front that otherwise seemed settled on a neutral pivot.

That is another factor keeping the bank moderately bearish on EUR/USD and ING continues to favor a move to 1.150 in the near term.

The end of the week in the Central and Eastern European (CEE) region should be quiet, according to ING. The calendar doesn't have much to offer on Friday. However, the global story continues to shape sentiment.

Although on Thursday the bank saw Hungary's forint (HUF) outperforming its CEE peers, in the rates space ING saw the opposite picture.

While Poland's zloty (PLN) and the Czech koruna (CZK) continue to be paid, leading to a wider interest rate differential, in HUF rates on Thursday, investors saw a reversal in the differential after nearly 10 days, added ING. As a consequence, the bank believes EUR/HUF has little chance but to test new lows towards 398 and the current range of 399-400 should roughly still work.

On the positive side, there's Hungary's central bank (MNB) meeting next week, but given the market pricing, the hawkish tone shouldn't bring much support for currency. Elsewhere in the region, rate-paying flows continue to support foreign exchange, and both CZK and PLN should retain some backing despite a stronger US dollar (USD) and their underperformance on Thursday.