EUR/USD has been a rollercoaster this year, with the USD likely to stay well-bid until year-end. Economists at UBS analyze the pair’s outlook.
The narrative that the Fed needs to cut policy rates before the ECB is questionable
The near-term risks are skewed toward additional US Dollar strength.
Given the latest macroeconomic data, it has become questionable whether the Fed needs to cut policy rates before the European Central Bank. Hence, there is risk that the USD might gain further ground versus the EUR, and EUR/USD could slip back below 1.05.
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