EUR/USD: Medium-term strength as ECB will deliver, again – Wells Fargo

FXStreet Insights Team FXStreet

EUR/USD preserves its recovery momentum. Economists at Wells Fargo expect the shared currency to gain ground against the US Dollar amid further European Central Bank tightening.

ECB's Deposit Rate to peak at 3.50% by June this year

“We expect a further 25 basis points rate hike in May followed by a final 25 bps rate hike in June, which would see the ECB's Deposit Rate for the current cycle peak at 3.50%. In that context, market pricing, which currently implies a peak policy rate of around 3.09%, appears light to us.”

“Our more forceful outlook for ECB policy is an important factor supporting our outlook for medium term strength in the Euro versus the US Dollar.”

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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.

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