EUR/USD: Dollar correction faces resistance – Societe Generale
Societe Generale's view on EUR/USD suggests that any dollar correction might encounter resistance, indicating sustained short-term support for USD strength. The current market dynamics reveal a cautious sentiment toward the euro, as traders remain aware of the shifting macroeconomic landscape. This is particularly relevant as the euro struggles against a backdrop of diverging monetary policies, which could amplify the dollar's resilience despite potential correction scenarios.
Where it sits in our coverage
Our consensus EUR/USD target stands at 1.1700 (median across various firms), with RBC at the upper end (1.2000) and Lloyds at the lower end (1.1200). Societe Generale aligns closely with the upper-tier estimates, forecasting a target of 1.1700 for March 2026, highlighting their bullish outlook amid current market pressures.
How firms align
Several firms echo Societe Generale's optimism, including Barclays and Nomura, both targeting 1.1700 in March 2026. Conversely, BofA takes a divergent stance, forecasting a more bearish outlook with a target of 1.1200 for the same period, which signals potential volatility in the EUR/USD pair. Details can be found in our internal reports like /research/eurusd-ecb-rate-path.
What the data shows
Recent forecast revisions indicate a marginal shift towards a slightly higher target, as firms like BNP Paribas revised their March 2026 target to 1.1600, aligning with the general bullish sentiment towards the dollar despite resistance concerns. For further insights, refer to /research/eurusd-ecb-rate-path-2026-09-30.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01USD faces resistance but maintains strength near 1.14 levels.
- 02Firm sentiment indicates that traders may focus on next week's economic data.
- 03Any unexpected shifts from the ECB could test these resistance levels in EUR/USD.
Market implications
Traders should monitor the key level of 1.1440, as a breach above could invite more aggressive positions on the dollar. The upcoming ECB meeting will be critical for determining the euro's trajectory against the dollar, especially given our consensus target of 1.1700 by March 2026.
Risks to this view
A significant shift in the ECB's policy outlook towards a more hawkish stance could undermine the dollar's current momentum, challenging the prevailing resistance narrative. Additionally, unexpected economic data from the US that indicates stronger performance could also lead to a reassessment of USD strength.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.60
Firms mentioned
Sources & References
How we cover this story
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