Eurusd To Move Higher

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Eurusd To Move Higher

Eur/Usd To Move Higher Towards 1.16 In 2025 - Ubs

According to UBS analysts, the EUR/USD pair will have a volatile year ahead of it. The EUR/USD is expected to cross 1.10, and by the end of 2025, it will reach a high of 1.16.

This forecast from the UBS assumes that the EUR will strengthen while the USD will weaken throughout the year 2025. However, the only major risk to this forecast is Donald Trump, who will be joining the president's office in January 2025.

Eurozone Economy To Recover Strongly

Despite these headwinds, UBS still believes that 1.16 is the path of least resistance for the EUR/USD. They also added that the US Dollar remains a sell after every bout of strength. This becomes more important if Trump wins, and that has already happened.

The months of August and September were weak for the US Dollar. However, the Greenback made a comeback after that on the release of robust labor market reports and PMI data. On the other hand, the ECB lowered its policy rate after a weaker Eurozone inflation print.

Looking ahead, there's a bumpy road for the US Dollar as the Fed may be forced to rethink its policy again. The situation will become a little clearer once Trump joins the office and offers more clarity on his economic policies.

The initial strength in the US Dollar after the Trump win will be short-lived, according to UBS. They added that the US GDP would be negatively affected by tariffs and would directly affect US consumers.

In the Eurozone, the UBS maintains its bullish outlook and even hints at a strong recovery in 2025. They added that any good data from the Eurozone would be enough to turn the pessimistic sentiment into a positive one. Given all of that, UBS remains committed to its forecast of 1.16 for the EUR/USD by the end of 2025.

However, the uncertainty cast by Trump's tariff plans remains a key headwind for this forecast by the UBS.

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