Forex Flash: EUR/USD to slide back to 1.25 towards end 2013 – Scotiabank (Barcelona) - The single currency is back to the proximities of the key mark at 1.3000 on Tuesday, after the ZEW Survey data in Germany and the euro zone have surprised to the upside, along with a well-received Spanish auction of Letras.

Camilla Sutton, Chief Currency Strategist at Scotiabank, remarks both the FOMC and the EU Summit meetings have the potential to weight on the cross. “Beyond the all important FOMC meeting on Wednesday, the end of week EU leaders summit will be important. The focus will be on negotiations over the banking union and single supervisory mechanism (SSM). An agreement would prove EUR positive; however significant divergence in views would be a weight on EUR into year-end. We expect EUR to trend lower in 2013, expecting it to close at 1.25”, the expert explains.