EUR/USD forecast as Goldman Sachs predicts a return to dollar slide - Invezz

What the desk is arguing

Goldman Sachs' recent forecast indicates a notable downward trend for the U.S. dollar, which is expected to bolster the euro significantly over the coming months. This outlook suggests a fresh wave of confidence in the eurozone's economic resilience and hints at potential monetary policy shifts that may favor euro strength.

Supporting this thesis, the consensus target for EUR/USD shows a steady upward trend, with most major banks adjusting their targets upwards for 2026. Goldman’s specific call of 1.2500 by December 2026 is consistent with rising sentiment across the analyst community that favors the euro as the dollar's strength wanes, especially in the face of anticipated interest rate adjustments by the Federal Reserve.

Where it sits in our coverage

Our current consensus target for EUR/USD stands at 1.2200 in December 2026, which indicates a broader optimism within the market, albeit slightly more conservative than Goldman’s perspective. The range of targets from various banks reflects their confidence in the euro’s potential upward momentum against the dollar, with most firms indicating levels within the 1.1700 to 1.2500 range.

• Goldman: Dec26 1.2500
• Deutsche Bank: Dec26 1.2500
• MUFG: Dec26 1.2400

How other firms see it

Other banks largely support the view of euro strength against the dollar, with several aligned in their outlook. Morgan Stanley and ING, for example, project EUR/USD targets that resonate well with Goldman’s forecasts, albeit generally taking a more cautious approach with lower forecasts toward the end of 2026.

• Morgan Stanley: Dec26 1.1600
• ING: Dec26 1.2200
• Barclays: Dec26 1.2100