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EUR/USD continues to lose ground and has fallen below the 1.08 level. What is the outlook for the pair in the coming months?

Here is their view, courtesy of eFXdata:

Bank of America Global Research discusses EUR/USD outlook and outlines  6 key reasons for staying structurally bearish on the pair over the coming months targeting a move towards 1.02.

“Though  EURUSD is undervalued  by about 10%,  according to our estimates, we see it weakening  further in  the rest of the year. We forecast EURUSD at 1.02-1.05, with risks to the downside.  

We  expect  EURUSD  to  weaken in the months ahead, given: a weaker global outlook, a more severe Eurozone recession, a weaker  Eurozone  macro policy response,  periphery  sovereign risks, low oil prices,  and a long  EUR  market position,” BofA argues.  

We  would  be wrong and EURUSD  would  strengthen if a cure or vaccine for  COVID-19  were to be found  soon,  as the global outlook  would  improve substantially,  or if the Europeans  were to  mutualize a substantial part of the increase in the government debtthrough a Eurobond/Corona bondbut this seems unlikely,” BofA adds.  

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