Jpmorgan Forecasts Eurusd Parity

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Jpmorgan Forecasts Eurusd Parity

Jpmorgan Forecasts Eur/Usd Parity In 2025

JPMorgan has now become more bearish on the Euro after the conclusion of the US presidential elections. With Trump's win, the EUR/USD is at risk of reaching parity during Q1 2025.

For now, EUR/USD is seen near 1.0499, which means we are around 499 pips away from parity. From a fundamental point of view, tough tariffs on the Eurozone by the USA could plunge the EUR/USD back to parity.

Eurozone Growth Remains Weak

If we look at 2024, it was a year of disappointment as the Eurozone growth remained weak. On the other hand, the USA's economy has experienced solid growth.

JPMorgan analysts added that the softer growth in the Eurozone isn't something new. In fact, the trend of weakness has been consistent for the last 7 years in a row. Now, that may not be something new, but it's definitely something that shows its effects on the price action.

The performance of EUR/USD in 2024 was mostly due to the interest rate differences along with other relevant factors.

For 2025, JPMorgan believes that EUR/USD will attempt at parity during the first three months of 2025. After that, EUR/USD will recover higher and reach the level of 1.08 sometime later in 2025.

In the short term, the EUR/USD remains stuck in a bearish bias, with the tariff risks being the dominant factor. Also, any changes to the monetary policy by the US Fed will also be closely watched.

As for the interest rates, they will remain near 4% in the USA, while the ECB may lower them to around 1.75%. After that, the ECB is expected to hold the rates.

JPMorgan also added that the Eurozone is facing vulnerability in regard to trade conflicts. This stems from trade openness, manufacturing reliance, and other factors.

If things continue like this, the EURO will become the new JPY. In simple words, the Euro will weaken to record lows during the year 2025.

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