The EUR/USD It trades below 0.9830, on track for the lowest weekly close in decades. Analysts at MUFG Bank maintain a bearish outlook on the pair EUR/USD for October. They see the pair trading in a range between 0.9500 and 1.03000.
“For the month ahead, we maintain a short EUR/USD bias. The Fed’s commitment to further significant rate hikes and tightening global financial conditions should continue to support US dollar strength. The Fed has clearly signaled that it wants to see sustained evidence that inflationary pressures are easing before making a dovish policy turn.August’s stronger US CPI report has provided an even greater hurdle for a dovish pivot.”
“The main upside risk to our EUR/USD bearish bias could be triggered by a further cutback from the sharpest energy supply concerns in Europe. a further slowdown in the eurozone. At the same time, the euro could strengthen more than expected if the ECB continues to raise rates at a faster pace while the Fed signals that it is considering slowing the hikes.”
Source: Fx Street