EUR/USD: Consensus shifts lower on Dollar resilience – Societe Generale

FXStreet Insights Team FXStreet

Kit Juckes at Societe Generale notes that EUR/USD forecasts have been repeatedly revised down as Dollar strength persists. While consensus has moved from 1.20 to 1.16 and Societe Generale now sees 1.15, client discussions suggest markets are even more Dollar-bullish. Strong US data and inflation could push EUR/USD toward new lows in the near term.

Forecasts cut as pair grinds lower

"At the start of this year, consensus forecasts expected EUR/USD to reach 1.20. We projected 1.14. Now, the consensus has moved down to 1.16, while our forecast stands at 1.15 (and I'm regretting the change)."

"The impression we get from client meetings is that the market is, overall, considerably more dollar-bullish than even those forecasts suggest. Elevated oil and other commodity prices, robust US economic data, and a more risk-averse global environment have bludgeoned bearish dollar views."

"Higher inflation and resilient real-economy data could propel the Dollar Index to a near-2026 high (just 0.7% away) or push EUR/USD to a new low (only 0.5% away)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD turns south toward 0.6900 as USD firms up

AUD/USD sees fresh selling and drops toward 0.6900 in late Asian trading on Monday, as renewed US Dollar strength weighs on the pair amid lingering Middle East and Russia-Ukraine geopolitical tensions. Focus remains on Oil prices, Treasury bond yields, and RBA expectations for fresh trading impetus in the major.

USD/JPY retakes 158.00 amid hawkish BoJ bets, firmer USD

USD/JPY erases losses and retakes 158.00 in the Asian session on Monday, trading within a one-week-old range. Geopolitical uncertainty continues to underpin the US Dollar, despite fading Fed rate hike hopes, supporting the pair's rebound. However, further upside could be capped by hawkish BoJ expectations and looming intervention risks that could support the Japanese Yen.

Gold bulls remain on the sidelines as USD rallies to fresh YTD peak

Gold struggles to capitalize on a modest Asian session uptick, and currently trades just below $4,150, nearly unchanged for the day amid mixed cues. As investors look past Friday's disappointing US jobs data, the US Dollar regains strong positive traction and rallies to a fresh high since April 2025. This is seen as a key factor capping the commodity, though receding bets for an October rate hike by the Federal Reserve help limit the downside.

Dogecoin: ETF inflows and technicals fuel recovery

Dogecoin (DOGE) extends its gains, trading above $0.096 on Monday after finding support around the key support zone last week. Continued inflows into spot DOGE Exchange Traded Funds (ETFs), alongside strengthening derivatives metrics, indicate improving market sentiment. Meanwhile, the constructive technical outlook suggests the meme coin could extend its gains if the key level holds.

Economics week ahead

In the U.S., the September ISM Services index is expected to ease modestly while continuing to signal expansion, with particular attention on whether price pressures remain elevated. In Canada, the labor market likely rebounded in September, although broader trends still point to a cooling pace of employment growth.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.