EUR/USD still targets 1.2500 in 12-month – Danske Bank
Chief Analyst at Danske Bank Christin Tuxen expects the pair to visit the 1.2500 area within a year’s view.
“Dips in EUR/USD could occur near term as the risk of USD support from a US tax reform and the relative cyclical position and policy-cycle remain”.
“We still stress that dips should be shallow and short-lived as fundamentals still provide support to the cross and as notably a reversal in debt flows is a key source of upside EUR risks over the medium term”.
“We still look for the 1.1479-1.1880 range to hold towards year end but continue to stress that a 2018 rebound towards 1.25 is in the cards and that upside risks dominate the longer-term outlook”.
“We now see the cross at 1.16 in 1M and 1.16 in 3M (previously 1.18). We keep our forecasts for the 12M horizon unchanged at 1.25 but lower the 6M forecast to 1.20 (previously 1.22) to reflect that the ECB has postponed the potential for ‘normalisation’ trades somewhat”.