EUR/USD forecast: all eyes on ECB – BAML and Rabobank

By FXStreet FXStreet (Edinburgh) – EUR/USD is trading flat ahead of the opening bell in Euroland and the ECB gathering, with consensus still pointing to a dovish message from Draghi & Co.

Jane Foley, Senior Currency Strategist at Rabobank, noted “the fact that the Fed is still expected to start normalising policy at a time when the ECB is likely to be aggressively engaged in monetary easing should still lend support to the US dollar versus the euro into 2016. While we have recently revised up our 1 to 6 months EUR/USD forecasts. We remain unconvinced that the downtrend in EUR/USD is over and we have retained our long standing 12 months forecast of EUR/USD 1.05”.

In addition, Analyst at BAML Athanasios Vamvakidis suggested “We are keeping our EUR/USD end-2015 projection at parity for now. However, upside risks to our projection have increased notably following the CNY devaluation. The market turmoil has triggered an unwinding of risk positions, which has benefited the Euro as it has become a funding currency”.
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Source:: FX Street