EUR/USD is under pressure, as the US dollar has shown some strength lately. What is the outlook for the pair into -year-end?
Here is their view, courtesy of eFXdata:
Bank of America Global Research maintains its EUR/USD profile unchanged targeting the pair through 1.14 into year-end.
“We expect a USD rally into the election and possibly beyond, depending on the outcome. We continue to expect a decline in EUR/USD to 1.14 by the year-end, significantly below current levels, rebounding again next year as the global recovery eventually takes hold. An increase in FX risk premium amid more volatile market conditions – which we believe are consistent with present high uncertainty and lack of official policy support – appears a necessary condition for a USD rally, however,” BofA notes.
“For next year, we expect EURUSD at 1.20. Our long-term equilibrium range estimate is 1.20-1.25,” BofA adds.
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