EUR/USD at new lows: Will the sell-off end?
The EUR/USD has hit new lows, currently trading at 1.1446 amidst a broader sell-off fueled by hawkish signals from the Federal Reserve. The recent market action reflects growing concerns over the ECB's policy stance as well, which has left traders questioning the sustainability of any support for the euro. Given the significant divergence in forecasts across major banks, the question remains whether this downward trajectory will stabilize or prompt a new wave of volatility.
Where it sits in our coverage
Our consensus EUR/USD target currently stands at 1.1700 (median across 10 firms), with RBC at the upper bound (1.2000) and Lloyds at the lower end (1.1200). The current spot price of 1.1446 indicates a notable disconnect from this consensus, suggesting potential volatility ahead.
How firms align
While firms like SocGen and Nomura align closely with the headline's bearish sentiment, forecasting targets of 1.1700 and 1.1800 respectively, others such as Commerzbank and CIBC stand firmly more bullish, predicting prices above 1.1900. This divergence highlights uncertainty in the market. More insights can be found in our recent report on the ECB rate path /research/eurusd-ecb-rate-path.
What the data shows
Recent revisions, particularly from BofA adjusting its Mar26 target from 1.1700 to 1.1200, indicate a shift in sentiment that mirrors the ongoing pressure on the euro. Our earlier work on target gaps /research/eurusd-ecb-rate-path-2026-09-30 also shows a persistent divergence between spot and consensus levels.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD trading at 1.1446 indicates ongoing bearish sentiment.
- 02Divergence between consensus and spot presents trading opportunities.
- 03Increased volatility is expected as firms revise targets lower.
- 04Maintain close watch on ECB policy for direction.
Market implications
Traders should keep an eye on the 1.1400 mark for potential support. Major upcoming data releases, including Eurozone inflation figures, could further influence the EUR's trajectory. The consensus target of 1.1700 remains a critical reference point amidst this uncertainty.
Risks to this view
A shift in ECB policy signaling a more aggressive rate hike could force a sharp reversal in the EUR/USD dynamics. Continued hawkish messaging from the Fed may compound this risk, especially if data supports more tightening.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
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