EUR/USD expected to be trading below current levels at year-end – Rabobank
|EUR/USD has had very little difficulty pushing through its spring high – just below 1.11. Economists at Rabobank analyze the pair’s outlook.
A soft USD is likely to prevail in the near-term
Signs of disinflation in the US and a high level of scepticism about the ability of the Fed to hike rates beyond the July meeting suggest that a soft USD is likely to prevail in the near-term. That said, signs that the ECB’s rate hike cycle is moving towards its peak suggest that EUR/USD could struggle to make further gains beyond the summer season. Additionally, if US recession fears strengthen into the end of the year, the USD could benefit from broad-based support.
We have revised down our USD forecasts across the board on a one-month view in response to the disinflationary signals in the US. However, in view of our house forecasts surrounding US recession risks, and in consideration of the economic headwinds facing the Eurozone, we see EUR/USD trading lower into year-end and through the early part of 2024.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.