Bank of Montreal economists expect the EUR/USD suffer in the short term, but they see the pair recovering towards the 1.10 level by the end of the year.
A further downward correction of the EUR/USD towards the end of the year is not the baseline hypothesis
A deeper EUR/USD downward correction towards the end of the year is not the baseline scenario, but downside risks have increased, particularly against an unfavorable global trade backdrop and a transatlantic economic divergence that will continue. remaining broad for approximately another quarter. Closer ties between Russia and North Korea also portend higher levels of geopolitical risk related to the Ukraine war.
The Euro is likely to struggle to maintain bullish momentum in the near term. However, the baseline hypothesis is that moderate EUR/USD strength will bring the exchange rate back to 1.10 by the end of the year.
Source: Fx Street
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