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The Pound and Euro Should Weaken Substantially Through Early 2024 – Wells Fargo

Against a backdrop of dollar strength combined with bleak local economic prospects, economists at Wells Fargo They expect the Euro and the Pound to perform worse.

Pound and Euro weaker until early 2024

Surveys on sentiment for both economies have softened considerably in recent months, and European underperformance relative to the US should weigh on both currencies.

The European Central Bank and the Bank of England have also signaled that interest rates have likely peaked, reducing interest rate support for their respective currencies.

Against this backdrop, we forecast a weakening of the pound and euro until early 2024, with a low for GBP/USD around 1.1600 and a low for EUR/USD around 1.0200.

Source: Fx Street

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