ANZ forecasts EUR/USD to reach 1.10 - 1.08

According to ANZ, the outlook for EUR / USD is not encouraging. According to the bank, sales at the top are a recommended option, with the attitude remaining bearish and their target by the end of this month is 1.10 and 1.08 for the first half of the year.

They argue with the early signs of a slowdown in the eurozone economy that first emerged in the second half of last year, but predicted that the situation would worsen in 2019. The sources that pose the risks of recession are political, geopolitical and specific individual economic sectors. Solving problems from these sources is not in the power of monetary policy.

However, the ECB is firmly committed to meeting its inflation target. ANZ's expectations are for the ECB to update its vision of the current business environment and to announce a new wave of TLTRO (incentives) soon. The central bank has to keep the economy from prolonged sinking, swiftly change its fiscal approach and improve credit conditions.

Reduction of growth and low inflation expectations lead to an equalization of the yield curve. Trends at EUR / USD are highly dependent on it. ANZ, based on current trends, believes that EUR / USD will continue its downward movement.

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