UBS On-Air: Paul Donovan Daily Audio 'Credibility and the “sell US” trade'
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
UOB | — | 1.1445 |
J.P. Morgan | — | 1.1300 |
Goldman Sachs | — | 1.2000 |
All 27 desk targets for EUR/USD
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Investors and the US administration are likely to keep focus on the US Treasury bond market, which weakened modestly in the wake of US President Trump’s latest tariff threats. The implications of additional tariffs are more US inflation pressures and a further erosion of the USD’
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4 itemsUBS On-Air: Paul Donovan Daily Audio 'Capping inflation'
The updated commentary from UBS highlights the connectedness of bond market movements, geopolitical tension, and inflation expectations. As investors react to the ongoing war in the Middle East, there is speculation that pressure on bond yields may prompt a policy response from the U.S. administration similar to that observed during tariff negotiations. Per the full note [source], while markets are anxious about rising inflation driven by fuel and food prices, the likelihood of a meaningful policy shift remains uncertain due to the complex geopolitics involved. This context holds potential implications for currency pairs sensitive to U.S. fiscal and monetary policy shifts.
UBS On-Air: Paul Donovan Daily Audio 'They’re back'
The desk interprets recent commentary from UBS regarding the re-emergence of tariffs proposed by US President Trump, which could impact both inflation perceptions and the affordability crisis in the US consumer market. According to Paul Donovan, the implications of these tariffs may be less severe than previous ones given consumer behavior and pricing pressures surrounding high-frequency purchases. Per the full note [source], this suggests that while tariffs are politically charged, their inflationary impact could be mitigated by the context of prior tariffs that became embedded in pricing structures. With significant US consumer spending already under pressure, the market will be keenly watching reactions in inflation metrics and overall consumer sentiment as this situation develops.
UBS On-Air: Paul Donovan Daily Audio 'Say more'
The desk interprets the recent hawkish tone from the Federal Reserve, as outlined by Paul Donovan from UBS, as a significant shift in the central bank's commitment to combating inflation. This firm stance may create friction between Fed Chair Warsh and the Trump administration, particularly as the Fed's own research indicates that tariffs have contributed to rising inflation in the U.S. The establishment of new committees at the Fed raises questions about the agility of future policy changes, suggesting that the hawkish rhetoric may not translate into immediate actions. Ongoing scrutiny of U.S. unemployment, detailed in the Fed's truncated communication, highlights the complexities in navigating current economic conditions. Per the full note [source], this development emphasizes the importance of understanding the nuanced implications of Fed policy amidst structural changes in the economy, which have not been seen in the last 250 years.
UBS On-Air: Paul Donovan Daily Audio 'Tariff affordability'
Lead — The desk emphasizes the potential implications of the 15% tariff proposed by the U.S. administration on importers, noted by Treasury Secretary Besant, and how this impacts inflation perceptions in a U.S. context. According to the analysis, while this tariff may not substantially raise inflation, it influences affordability narratives across households. Per the full note from UBS, this evolving tariff landscape aligns with existing market expectations and financial models, suggesting traders should be poised for further fluctuations in related currency pairs.
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