JP Morgan raise their forecasts for AUD, NZD and for USD/JPY (EUR/USD unchanged) - investingLive
At a Glance
JP Morgan's upward revision of forecasts for AUD, NZD, and USD/JPY signals their confidence in bullish trends for these currencies, reflecting a potentially robust global economic recovery. In contrast, their unchanged forecast for EUR/USD suggests limited near-term volatility, signaling steadiness amidst evolving market dynamics.
Key Takeaways
Full Analysis
What the desk is arguing
JP Morgan's decision to revise their forecasts for AUD, NZD, and USD/JPY while maintaining their EUR/USD projection indicates a differentiated outlook on these currencies, likely based on expected shifts in economic conditions and central bank policies. This divergence reinforces the notion that while some currencies may capitalize on post-pandemic recovery, others may experience relative stability amid fluctuating monetary landscapes.
The updated forecasts for USD/JPY, which see the pair potentially reaching a target of 164 by December 2026, further emphasizes market expectations of a gradual tightening by the Bank of Japan. Conversely, leaving EUR/USD unchanged at 1.1500 nurtures the argument that the Eurozone may lag behind in monetary policy adjustments, which could prolong its relative weakness against a strengthening USD and the currencies of emerging markets.
Where it sits in our coverage
Current consensus for EUR/USD stands at 1.1800 for March 2026, alongside a projected range of 1.1700 to 1.2000. JP Morgan’s unchanged position aligns with this consensus, suggesting that their outlook supports a stable Euro amid potential shifts in other currency dynamics.
In comparison, firms such as Barclays and Deutsche Bank are projecting slightly higher targets for March 2026, indicating their belief in a stronger Euro:
- Barclays: 1.1700
- Deutsche Bank: 1.1800
For JPY forecasts, JP Morgan's target of 164 by December 2026 is considerably higher than the median consensus of 147.5, reflecting a more optimistic view on Japanese monetary policy and economic recovery. Other notable targets include:
- Goldman Sachs: 148.0000
- MUFG: 146.0000
- Morgan Stanley: 140.0000
How other firms see it
While JP Morgan's optimistic stance on JPY appears to stand in contrast to some firms, others like Goldman Sachs and Morgan Stanley provide lower projections, suggesting a more cautious approach. This divergence highlights differing views on the pace and effectiveness of BoJ policies moving forward.
- Goldman Sachs: Bearish on JPY with target of 148.0000 by December 2026.
- Morgan Stanley: Similarly cautious with a December target of 140.0000.
Market Implications
Market participants may interpret JP Morgan's revisions as a signal to reassess their positions on AUD, NZD, and JPY, while viewing the EUR strategy as a reminder of the Euro's ongoing challenges. This could lead to increased volatility in AUD and JPY trades as expectations shift.
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
MUFG | Bullish | 1.1800 |
Danske Bank | Bearish | 1.1100 |
UBS | Bullish | 1.1800 |
From the original
JP Morgan raise their forecasts for AUD, NZD and for USD/JPY (EUR/USD unchanged) investingLive
Related speeches
4 itemsJP Morgan raise their forecasts for AUD, NZD and for USD/JPY (EUR/USD unchanged) - investingLive
JP Morgan raised their forecasts for AUD, NZD and USD/JPY, but left EUR/USD unchanged. Our analysis contextualizes these revisions against consensus and other banks' views.
Global FX: EUR/USD contemplation, GBP fiscal and JPY woes
The desk is focused on the evolving dynamics of the EUR/USD currency pair amid broader European economic challenges. Per the full note from J.P. Morgan, the commentary highlights concerns around fiscal policies in the UK and ongoing issues in Japan, which could influence cross-border flows and positioning in the FX market. The current consensus suggests a moderate bullish outlook for EUR/USD, with a target of 1.075, reflecting a cautious optimism amidst geopolitical uncertainties and central bank policies. Traders should remain vigilant as these factors unfold, particularly in light of potential shifts in market sentiment.
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