Eurusd To Move Higher In 2024

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Eurusd To Move Higher In 2024

Eur/Usd To Move Higher In 2h2024, According To Mufg

According to MUFG, the EUR/USD showed weakness by the end of 2023. However, that could change during the 2nd half of 2024 as the ECB and the US Federal Reserve will ease the policy rate.

The bottom line is that the EUR/USD is in the correction phase for now, but that will change once we enter the 2nd half of this year. So, from July to August 2024, the EUR will reach new yearly highs.

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As for how the MUFG reached this conclusion, they added that the forward market shows that EUR will show strength in the next few months.

They added that the ECB and the Fed will move into the easing phase at the same time. So, it should be familiar if we see synchronization between the two.

However, there will come a moment when the interest rate in the USA will be lower than in the EU. That will be the moment when the EUR/USD will move upwards.

That's why it wouldn't be wrong to say that the respective markets' interest rates and bond yields will drive the movement in the EUR/USD.

For the H1 2024, MUFG believes that the outlook on EUR/USD is neutral. They also added that the US economy is slowing down while the Eurozone shows modest growth. That also suggests that the EUR/USD will move into positive territory during H2.

However, the one factor that could alter this forecast is the geopolitical risks and US politics. Furthermore, the opposite of the MUFG's forecast about EUR/USD can also materialize.

That will be the case when the growth rate in the USA surpasses that of the Eurozone. Furthermore, if the interest rate in the EU becomes lower than the Federal Reserve at any given time in 2024, it will also enable the USD to shine against the EUR.

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