06:34 AM EST, 01/21/2025 (MT Newswires) -- EUR/USD remains cheap and oversold despite Monday's rebound, said ING.

The bank estimates that the pair is still trading around 1.5% below its short-term fair value, signaling that some United States tariff-related risk remains in the price.

The euro could fare well if time passes without the European Union being explicitly mentioned in U.S. President Donald Trump's tariff comments, stated ING. That support may, however, prove rather short-lived as things can -- as markets learned Monday with Canada and Mexico -- change abruptly on protectionism, and the euro remains generally unappealing from a number of macro fundamentals.

This means any rebound may well fall short of 1.050 in EUR/USD, wrote the bank in a note.

EUR/GBP was "unfazed" early Tuesday by the release of United Kingdom's labor figures. Wage growth excluding bonuses was slightly higher than expected. However, the month-on-month increase in private sector pay, which the Bank of England closely monitors, was more subdued.

This figure has been fluctuating and follows a stronger reading previously, pointed out ING. Unemployment figures have been rather unreliable, but there are still broad indications that the jobs market is cooling enough to reduce wage growth over the year ahead.

The BoE's recent CFO survey shows expected wage growth dropping below 4% in recent months. This doesn't significantly alter the BoE's outlook, with a February rate cut still ING's base case.

EUR/GBP is looking at some upside risks in the short term as markets can still price in more BoE easing and continue to embed idiosyncratic sterling (GBP) risks related to higher borrowing rates. At the same time, the euro could see some tentative relief on Trump not targeting the E.U. with tariffs for now.

EUR/PLN moved down the trading range to 4.250-270 and it looks like markets will test the lower bound in the coming days thanks to the hawkish central bank of Poland support, added ING.

EUR/HUF also briefly touched 410, this year's lows, allowing Hungary's forint (HUF) assets to show some rally as well.

In the medium term, the bank expects EUR/HUF to head towards 420, but in the short term, ING believes the pair can stabilize around 412.

EUR/CZK also briefly headed lower but saw the biggest pullback within Central and Eastern Europe Monday, and ING believes it will stay closer to 25.300 until the Czech central bank shows more dovish headlines ahead of its February meeting, which could be as early as the end of this week.