EUR/USD could very soon rise back toward the middle of the 1.1000-1.1500 range – MUFG

FXStreet Insights Team FXStreet

EUR/USD advanced to its strongest level since early February above 1.0970. Economists at MUFG Bank expect the pair to move back toward the middle of that 1.1000-1.1500 range.

Two-year swap spread will help EUR/USD higher

“We see the US Dollar suffering most against the core G10 currencies. The Swiss Franc, Yen and Euro remain three of the top four best performing G10 currencies (the Pound is the other) and if yields in the US decline further that’s where we would expect to see the bigger moves.”

“EUR/USD continues to lag where yields imply it should be trading – somewhere between 1.1000-1.1500.”

“The 2-year EZUS swap spread closed yesterday at -86 bps, close to recent highs not seen since October 2021. If that level can be sustained over the short-term, we could very soon see EUR/USD back toward the middle of that 1.1000-1.1500 range.”

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