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Economists at Danske Bank believe EUR/USD will remain range-bound and target 1.07 in 12M while an uptick in global reflationary trends continues to be the key upside risk. 

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Key quotes

“The potential for a higher EUR/USD is closely linked to global reflationary trends and such a shock is indeed a notable but, in our view, unlikely upside risk.” 

“We forecast EUR/USD at 1.09 in 1-3M, as we see the EUR as embedding enough institutional risk premium, at least for now. Longer-term, we forecast EUR/USD at 1.07 in 6-12M.”