Despite the political noise in Germany, the EUR/USD remained firm while the markets observe the Fed in search of indications of moderation and remain positioned for a greater weakness of the USD throughout the year, Danske Bank’s FX analysts report.
The Fed at the Care Center while the moderate risk is coming
“Yesterday’s session turned out to be bad for the USD and, despite the slight political scare in Germany for Merz’s non -victory in the first vote for Chancellor, the EUR/USD still finished the session solidly upwards around level 13.50.”
“Today the attention will focus on the FOMC meeting tonight. Our base scenario implies little change in the USD after the announcement/the press conference, although the risk balance is probably biased towards a slight moderate surprise and, therefore, a weaker dollar.”
“We anticipate that the EUR/USD will move upwards during the next year with a 12 -month target of 1.22, and the performance of 10 -year treasure bonds decreasing to 4.20%. The upward risks for yields are more related to the premium component for a period than with the expectation of neutral risk rate. Finally, we do not expect changes in the QT after the reduction announcement in March.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
