14 Jul 2015
EUR/USD seen at 0.95 in 12-month – Goldman Sachs
FXStreet (Edinburgh) - In the view of analysts at Goldman Sachs, the single currency could weaken towards the 0.95 area in a year’s time.
Key Quotes
“We maintain our EUR/USD forecasts of 1.02, 1.00 and 0.95 in 3, 6 and 12 months, which we adopted on
March 13”.
“We continue to believe that EUR/USD and EUR/GBP will move substantially lower on diverging growth and monetary policy outlooks”.
“The EUR has already weakened significantly over the last 12 months, but we think this trend has a long way to run. In particular, we see a couple of longer-term fundamental forces at work”.
“First, the flow picture should turn increasingly EUR-negative as Euro area residents send funds abroad and reserve managers allocate away from the EUR”.
“Second, we think mounting tensions around Greece show that the process of ‘internal devaluation’ is difficult and a poor substitute for outright devaluation”.
“As a result, our view is that the ‘growth crisis’ in the Euro area means that inflation will be slower to pick up than during a normal cycle, in line with projections from our European team, which show HICP inflation reverting to target only slowly”.
Key Quotes
“We maintain our EUR/USD forecasts of 1.02, 1.00 and 0.95 in 3, 6 and 12 months, which we adopted on
March 13”.
“We continue to believe that EUR/USD and EUR/GBP will move substantially lower on diverging growth and monetary policy outlooks”.
“The EUR has already weakened significantly over the last 12 months, but we think this trend has a long way to run. In particular, we see a couple of longer-term fundamental forces at work”.
“First, the flow picture should turn increasingly EUR-negative as Euro area residents send funds abroad and reserve managers allocate away from the EUR”.
“Second, we think mounting tensions around Greece show that the process of ‘internal devaluation’ is difficult and a poor substitute for outright devaluation”.
“As a result, our view is that the ‘growth crisis’ in the Euro area means that inflation will be slower to pick up than during a normal cycle, in line with projections from our European team, which show HICP inflation reverting to target only slowly”.