EUR/USD holds gains above 1.1700 on US-Iran ceasefire extension
A ceasefire extension between the US and Iran has eased geopolitical risk, reducing safe-haven demand for the US dollar and lifting EUR/USD above 1.1700. The move aligns with our broader view that geopolitical catalysts can temporarily override fundamentals. While the headline gain is modest, it underscores the market's sensitivity to geopolitical headlines in a low-volatility environment. EUR/USD now trades about 1.7% above our latest spot of 1.1500, but remains well below the consensus median of 1.1800 for March 2026. The divergence between spot and consensus suggests room for further upside if the risk-on sentiment persists.
Where it sits in our coverage
Our consensus EUR/USD target for March 2026 sits at 1.1800 (median across 8 firms), with Morgan Stanley at the upper bound (1.2000) and BofA/Barclays at the lower (1.1700). The current spot at 1.1500 is 4.2% below consensus, and the headline's move above 1.1700 aligns more closely with the upper third — JPMorgan, Goldman, and ING share that framing with targets at 1.1800-1.1900.
How firms align
Morgan Stanley (Mar26: 1.2000) and ING (Mar26: 1.1900) are the most bullish, supporting the risk-on rally. BofA (Mar26: 1.1700) and Barclays (1.1700) sit at the lower end and would expect the move to fade. Our /reports/bofa and /reports/barclays pages detail their cautious stance.
What the data shows
Our published research /research/eurusd-consensus-divergence-may-2026 highlights the large gap between spot and consensus, suggesting potential for catch-up if the risk-on mood broadens. A decisive break above 1.1800 would challenge the bearish camp.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD holds above 1.1700 as US-Iran ceasefire extension reduces safe-haven USD demand.
- 02Consensus median of 1.1800 for Mar26 implies ~2.6% upside from current levels.
- 03Watch for sustained risk appetite and further geopolitical de-escalation to keep EUR supported.
- 04Key resistance at 1.1800; a break could target 1.1900 (ING Q1 forecast).
Market implications
Focus on whether the ceasefire holds and broader risk sentiment; EUR/USD now tests the 1.1700-1.1800 range. Our consensus median of 1.1800 (Mar26) is the next key level. A break above 1.1800 could accelerate toward Morgan Stanley's 1.2000 target. Monitor upcoming eurozone CPI data for fundamental confirmation.
Risks to this view
Renewed geopolitical tensions (e.g., ceasefire collapse) would reverse the rally. A hawkish Fed repricing or strong US data could also restore USD demand. If EUR/USD fails to hold 1.1700, the move risks being a short-term blip toward the 1.1500 spot.
Sentiment by currency
USD-EUR+JPY~GBP~Composite USD score: -0.35
Sources & References
How we cover this story
Other coverage on this pair
EUR/USD strengthens as mixed US labor data and hopes for a US-Iran deal pressure the Greenback.
Soft US labor print reduces Fed rate-hike conviction; geopolitical risk-off from Iran talks risk-off flows weaken USD safe-haven demand.
EUR/USD: Recovery eyes full retracement – Scotiabank
EUR/USD recovery momentum suggests technicians are positioning for mean reversion toward recent highs, indicating potential USD weakness into resistance.
EUR/USD: Binary path around Gulf deal – ING
EUR/USD: Oil shock, real rates and conflict risks – Commerzbank
Oil shock transmission via real rates and geopolitical premium widens USD carry advantage; EUR structural support erodes as terminal rates diverge.
Cross-firm research
EUR/USD Trades 3.87% Below Consensus: What the Gap Reveals
EUR/USD spot at 1.1727 sits 3.87% below the eight-firm median Dec-26 target of 1.22, exposing a structural divergence that demands explanation.
EUR/USD Consensus at 1.22 While Spot Sits 3.87% Below
Eight sell-side firms hold a median Dec-26 target of 1.22 for EUR/USD while spot trades at 1.1727, a gap that demands explanation.