EUR/USD had some rough times, but it is finally moving upwards and not only downwards. What’s next for the common currency?
The team at CIBC examines the basics:
Here is their view, courtesy of eFXnews:
It’s true, the situation is still pretty bleak in many countries across the Euro area, but the trend is improving, and generally beating downbeat expectations, notes CIBC World Markets.
“As a result, the EURUSD exchange rate and relative difference between the surprise indexes in the two countries has diverged widely. That doesn’t mean that the euro will strengthen rapidly from here, as part of the reason for previous economic disappointments was that the euro was overvalued at a 1.30-1.40 rate,” CIBC argues.
“But the encouraging trend within the economy should limit downside pressure in the near term and position us for a modest strengthening in the euro towards year-end,”CIBC projects.
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