Fundamental factors suggest that the Euro’s tenacity will be brief – Rabobank

EUR/USD has pushed higher this week. Economists at Rabobank analyze the pair’s outlook.

EUR/USD seen at 1.02 on a three-month view

Since fundamentals do not appear to justify the current buoyancy of the EUR, we expect that it is a function of position adjustment related to the strong sell-off in EUR/USD in recent months.

The current shake out in EUR/USD may be necessary but, in view of the softness of German economic numbers, we expect another move lower in the EUR on a three-month view.

We maintain a three-month forecast of EUR/USD 1.02.