The chief investment officer of Europe’s largest fund manager expects the euro to fall to parity against the dollar.
Vincent Mortier, the chief investment officer at Amundi, told the FT that the euro could reach parity in the next six months. The euro has traded above the dollar since 2002.
(Amundi’s official forecast, issued at the beginning of the month, has the less aesthetically pleasing $1.02 as its euro target.)
The euro
EURUSD,
traded at $1.0545, up slightly on Wednesday but down 7% on the year.
“We are facing lower growth or probably a recession in the eurozone,” he said.
His forecast comes as European Central Bank officials have increasingly pointed to July as the timing for the first increase in interest rates this cycle. ECB President Christine Lagarde became the latest to at least partially endorse that view, as she said a rate hike could come within weeks of stopping asset purchases, which she expects at the beginning of the third quarter. The ECB’s governing council has a rate decision scheduled for July 21.
The ECB is far behind other central banks in lifting interest rates, as its key rate is still in negative territory. Mortier told the FT that the ECB will be able to hike twice, to get the base rate to zero.
Source: https://www.marketwatch.com/story/euro-to-hit-parity-vs-the-dollar-this-year-europes-largest-fund-manager-says-11652270121?siteid=yhoof2&yptr=yahoo