EUR/USD made a 300 pips rise from the abyss. Some think it could fall from here, but the team at Credit Agricole sees an upwards move.
Here is their view, courtesy of eFXdata:
Credit Agricole CIB Research discusses the EUR outlook into next week ECB June policy meeting.
“Our view is still that the ECB may delay the announcement of the end of its asset purchases until July given the persistent political noise out of Italy and the recent evidence that the cyclical recovery in the Eurozone has lost some of its momentum. Delivering a hawkish surprise next week may risk rattling the EGB markets and thus triggering an unwarranted tightening of the Eurozone financial conditions in our view.
The ECB could still deliver a ‘hawkish hold‘, however, with the President Draghi likely to emphasize the improvement in the inflation conditions as a precursor for a policy changes in the near future.
All this could leave EUR on a gentle upward sloping path across the board. We maintain our bullish year-end forecast for EUR/USD of 1.26 and stick with our long position in the FX pair via options in our portfolio,†CACIB argues.
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