The End of Era: What Might the UK Face Next?
The deafening news shocked the whole world yesterday: the British Queen Elizabeth II died peacefully at the age of 96…
Euro’s forecast from Danske Bank
Information is not investment advice
According to economists from Danske Bank, the euro is still overvalued. They see the fair price at 1.16. Let’s see why.
To begin with, Danske Bank is a Danish bank, headquartered in Copenhagen. It is recognized as the largest bank in the whole of Denmark and a main retail bank in northern Europe. It is a credible bank with a huge background, therefore its forecasts are taken seriously. Danske Bank has doubts over the further euro appreciation. The main reason is the tech stocks’ boom. All major tech companies are based in the USA, therefore, all the capital flows will be headed there. Moreover, the bank believes the US equity market will keep rallying for longer and attract more and more investors. Danske maintains a EUR/USD forecast of 1.1600 in three months.
Besides, the European Central Bank doesn’t like the idea of the expensive euro as it will weigh on the EU exports and, as a result, may jeopardize the economic recovery. The euro has risen this week to almost multi-year highs but then contracted sharply amid the stronger dollar. If this trend continues, the ECB will have to take some action. According to Pictet Wealth Management, “the ECB is expected to cut its 2022 inflation forecast next week from 1.3% to 1.2% or 1.1% to reflect the deflationary impact of a stronger euro on the price of imports”. Moreover, the ECM may step up the pace of asset purchases as well. In a nutshell, the ECB will make all efforts to depreciate the euro.
Technical tips
EUR/USD has just bounced off the key support of 1.1800. Now it’s moving upwards to the significant resistance of 1.1850, which it has touched a few times already. If it manages to break it through, it will rise to the psychological mark of 1.1900. Support levels are at 1.1800 and 1.1770.
All eyes on the NFP report tomorrow at 15:30 MT time, as it will set the tone for the whole market for Friday and the next week as well. Stay tuned!
Similar
Why didn't oil prices calm despite OPEC+ attempts?
After months of pressure from the White House, Saudi Arabia relented and agreed with other OPEC+ members to increase production.
US Interest Rate Slowdown?
The US Federal Reserve may refrain from more aggressive interest rate hikes in March due to geopolitical risks after Russia's special operation in Ukraine…
Popular
United Nations Call the Fed to Cut Rates
A United Nations agency is warning that the central bank’s actions create a high risk of pushing the global economy into recession.
It’s Time to Look at New Zealand
Inflation in New Zealand is the highest since 1990, edging to 7.3% in Q2 2022. The currency is under heavy pressure as the Reserve Bank of New Zealand is trying to reverse the inflationary spiral. The week ahead will give us a valuable clue about the country’s monetary policy, and we are here to talk about that.
The CAD vs. the World: Mid-Term Scenarios for the Currency
In the middle of September 2022, the Canadian dollar has fallen to a 2-year low against the USD.
Choose your payment system
