EUR/USD: Chance of moving back to 1.20 in 2024 is very slim – SocGen

FXStreet Insights Team FXStreet

Kit Juckes, Chief Global FX Strategist at Société Générale, analyzes the sequencing and extent of easing to come by the Federal, the Bank of England and the European Central Bank.

Fed to ease before the BoE or the ECB

The market prices the ECB cutting before the Fed, which cuts before the UK MPC. Our economists think the order will be Fed, BoE, ECB. And while we look for the FOMC to cut rates by 150 bps in 2024, and for the BoE to cut by 125 bps, we expect a measly 25 bps from the ECB. That will take the Fed-ECB gap to even tighter levels than was the case in 2020 when EUR/USD traded up to 1.23.

I think the chance of EUR/USD making it back to 1.20 in 2024 is very slim indeed, but more narrowing in rate differentials than is priced in by the market seems likely and the euro will get some support from that.

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD declines as market caution lifts US Dollar

GBP/USD extends its gains for the second successive day, trading around 1.3200 during the Asian hours on Wednesday. The currency pair depreciated as the US Dollar gained momentum, driven by a combination of robust domestic economic data and a complex, mixed geopolitical landscape.

EUR/USD weakens below 1.1400 as Fed hike bets lift US Dollar

The EUR/USD pair trades on a negative note near 1.1380 during the early Asian trading hours on Wednesday. The major pair extends the decline as traders continue to assess the developments surrounding the US-Iran peace deal.

Gold retains bearish bias near two-week low as Fed hike bets support USD

Gold recovers slightly from a fresh two-week low, near $4,080 touched during the Asian session on Wednesday, though it lacks follow-through. The US Dollar stands firm near its highest level since May 2025 amid firming expectations of a Fed rate hike, which, in turn, is seen undermining the non-yielding bullion. Furthermore, mixed US-Iran signals over Tehran's nuclear issues favor the USD bulls, suggesting that the path of least resistance for the commodity remains to the downside.

Australia CPI set to show inflation accelerated again in May

The Australian Bureau of Statistics will publish the high-impact Consumer Price Index for May on Wednesday at 01:30 GMT. Heading into the inflation test, the Australian Dollar is at its lowest level in two months against the US Dollar, having surrendered the 0.7000 psychological mark.

"Rearranging the deckchairs on the Titanic": UK's fiscal crisis outlasts another Prime Minister

Keir Starmer's resignation as the UK Prime Minister comes ten years after the Brexit referendum vote, a coincidence that financial markets have been quick to note. The British Pound trades around 1.3220 against the US Dollar on Thursday.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.