Deutsche Bank economists remain neutral on EUR/USD.
The Fed continues to be the main catalyst for the downward movement of the Dollar
We maintain a neutral stance on EUR/USD. The main reason why EUR/USD has failed to break higher this year is the relative superiority of US growth compared to Europe. We believe that this divergence in growth has peaked, with forward-looking indicators improving in Europe and deteriorating in the US.
The Fed remains the most important catalyst for a downward move in the Dollar. Although the inflation outlook in the US appears increasingly benign, the improved growth results support the Dollar.
We are lowering our year-end forecast from 1.15 to 1.07 to reflect our neutral view.
Source: Fx Street
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