Economists at Rabobank expect the EUR/USD pair to trade around the 1.13 level on a one to three-month view while see a dip below 1.10 on a six-month view.
Key quotes
“In response to the changes in EUR fundamentals we revised higher our forecasts for EUR/USD in the spring, expecting to see EUR/USD fluctuating around the 1.13 level on a one and three-month view. Beyond that we saw risk of another dip below 1.10. The rationale behind that view is the assumption that risk appetite will dip again on the back of another wave of covid-19 or on associated weak economic and corporate news. In view of the USD’s safe-haven characteristics, we continue to expect a pullback in risk appetite to support the USD.”
“While we leave our forecast of another dip below EUR/USD 1.10 on a six-month view unchanged, we acknowledge that the EUR could see some additional near-term support at the end of the week from the EU summit.”
“From a technical perspective EUR/USD would have to break above the long-term downside trendline at 1.1655 for a bullish scenario to materialise.”
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