EUR/USD to rally step by step in 2018 – what are the drivers? – SocGen

0

EUR/USD had a good 2017 so far, rising from the depths of 1.0340 very early in the year and all the way to 1.20 before finding a range under this round number. What’s next? The team at ScoGen sees rallies ahead.

Here is their view, courtesy of eFXnews:

Societe Generale Cross Asset Strategy Research discusses EUR outlook in 2018, and thinks that the next leg of the EUR/USD recovery should be driven more by EUR rates than USD rates

“The ECB’s very accommodative monetary policy has fuelled a clear acceleration in eurozone growth. In 2018, anything that revives the ECB policy normalisation debate will likely support the euro. Our bearish dollar view owes less to US growth expectations than it does to expectations that the recovery in Europe/Japan is here to stay. We thus expect EUR/USD to continue to unwind its undervaluation.

…Specifically, with more uncertainty surrounding ECB normalisation than the Fed’s tightening cycle – implying more room for European yields to grind higher – the next leg of the EUR/USD recovery should be driven more by EUR rates than USD rates,” SocGen argues.

SocGen targets EUR/USD in 2018 at 1.21, 1.23, 1.25, and 1.28 by end of Q1, Q2, Q3, and Q4 respectively.

For lots more FX trades from major banks, sign up to eFXplus

By signing up to eFXplus via the link above, you are directly supporting Forex Crunch.

Get the 5 most predictable currency pairs

About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

Comments are closed.