Analysts at Rabobank think about the US greenback has the capability to maneuver EUR/USD to the 1.10 space this 12 months, they’re projecting this on a 6 month view primarily based on the expectation that the Federal Reserve’s tightening cycle can be underway by then. Later they see the EUR/USD rebounding.
“The June FOMC was instrumental to the turnaround in USD sentiment final 12 months for the reason that actions within the dot plot at this assembly stimulated the controversy in regards to the prospects of a Fed price rise in 2022. Though Fed-related information this 12 months has retained a hawkish tone, the USD is struggled to seek out its toes. Insofar as there’s already a whole lot of hawkish information within the value, the USD could must see some pullback and contemporary information on the rate of interest entrance earlier than discovering route.”
“Whereas we count on that the USD has the capability to maneuver in direction of the EUR/USD1.10 space this 12 months, we’re projecting this on a 6 month view primarily based on the expectation that the Fed’s tightening cycle can be underway by then. Given that there’s at present a whole lot of good news within the value, we count on that the USD could proceed to battle to seek out its toes within the near-term.”
“Throughout the latter a part of this 12 months, expectations relating to price hikes in different G10 central banks and the chance that CPI inflation within the US will begin shifting again in direction of the Fed’s goal might sap the outlook for the USD. We count on EUR/USD to begin edging larger in H2 and thru 2023.”