Our view over the past few quarters has been that EURUSD should be rangebound, as the cyclical outperformance of the US economy is offset by the eurozone’s relatively better balance of payments position.
While tariffs remain a concern, the key issue is the degree—which we deem moderate—of U.S. recession risk. The current global backdrop makes the U.S. dollar unlikely to strengthen. Earnings growth expectations are modest, valuations are undemanding
Markets, economy, stocks, growth, global, fixed income, international, asset classes
Market sentiment towards the Chinese currency has shifted significantly
The performance of the US dollar significantly diverged from relative rate spreads.