EUR/USD eyes 1.12 as JPY pairs bounce - How far can they rally? Can USD/JPY break 159?
The EUR/USD pair is inching closer to the key 1.12 mark, collaborating with a bullish USD/JPY narrative that hints at potential resistance below 159. This alignment signals a broader weakening of the dollar, drawing interest in yen pairs that are bouncing off recent lows. As market sentiment shifts, the consolidation of dollar weakness with bullish undertones for the euro could lead to further rallies for EUR/USD, reflecting confidence in Eurozone stability amid US economic headwinds.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1700 (median across 11 firms), with CIMB at the upper bound (1.2200) and Lloyds at the lower (1.1200). The headline reflects a sentiment that aligns with key players like SocGen and RBCCapital, who share a similar bullish outlook for the euro.
How firms align
Specifically, firms such as SocGen and RBC have pegged their targets for March 2026 at 1.1700 and 1.1600, respectively, which fits within the bullish context provided by the article. Meanwhile, firms like Nomura and Barclays also share higher projections, supporting the overall positive sentiment on EUR/USD. The detailed positions can be referenced in our reports on SocGen and RBC.
What the data shows
Recent revisions indicate a consistent upward trend, with BofA and ANZ both adjusting their targets to 1.1700 for March 2026. Notably, our published research shows a continued divergence between spot prices and consensus targets, spotlighted in /research/eurusd-ecb-rate-path, where the current spot is notably below the median target of 1.17.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD approaching critical resistance near 1.12 amid weaker dollar sentiment.
- 02Yen pairs are rebounding, indicating potential market corrections.
- 03Focus on EUR/USD at 1.1700 as a target; bullish positioning is favored.
- 04Watch for further catalysts in Eurozone economic data.
Market implications
The next focal point will revolve around key economic data from the Eurozone and the upcoming ECB announcements, as traders look for signals that could either bolster or weaken the current bullish stance on EUR/USD. Given our consensus target of 1.1700, traders should remain attentive to any shifts in risk sentiment or policy guidance from the ECB.
Risks to this view
A significant shift in US economic data or unexpected hawkish signals from the Federal Reserve could undermine the current bullish outlook for EUR/USD and lead to a stronger dollar, potentially invalidating this perspective. Key upcoming US CPI or employment figures would be critical catalysts to watch.
Sentiment by currency
USD EUR+JPY+GBP~Composite USD score: -0.35
Sources & References
How we cover this story
Other coverage on this pair
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