EUR/USD shrugs off the risk-off mood and weak data, pops up above 1.1700
EUR/USD pushed above 1.1700 despite a risk-off tone and weak eurozone data, signaling that short-term positioning or technical factors are overwhelming macro negatives. The pair's resilience suggests market participants are looking through the data softness, possibly pricing in a more hawkish ECB stance or a near-term floor from elevated energy prices. This move comes as our consensus targets average 1.18 for March 2026, leaving spot 2.5% below the median, implying that the current rally may be a convergence towards fair value rather than a sustained breakout.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1800 (median across 8 firms) for March 2026, with Morgan Stanley at the upper bound (1.2000) and BofA at the lower (1.1700). The headline's view aligns more closely with the consensus cluster — JPMorgan, Goldman, ING, MUFG, and Deutsche Bank all target 1.18-1.19 for Q1 2026, supporting the idea that the spot move towards 1.17 is a normalization rather than an anomaly.
How firms align
Morgan Stanley and ING are most aligned with the bullish momentum, as they target 1.20 and 1.19 respectively for March 2026, above consensus. Conversely, BofA and Barclays, with March targets at 1.17, are already at the level spot has reached, implying less upside conviction. The broader consensus leans constructive, but the dispersion from 1.17 to 1.20 highlights the debate around eurozone growth prospects.
What the data shows
Our prior research, 'EUR/USD Consensus at 1.22 While Spot Sits 3.87% Below' (slug: /research/eurusd-consensus-divergence-may-2026), highlighted a persistent gap between consensus and spot. The current move narrows that gap, but the December consensus of 1.22 still implies 4% upside, suggesting the market expects further strengthening. No recent forecast revisions were captured in this coverage.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD breached 1.1700, defying risk-off and weak data, suggesting technical or positioning factors dominate near-term.
- 02Consensus March 2026 target at 1.18 with a 1.17-1.20 range; spot now within 0.9% of median.
- 03Medium-term bullish bias intact: December 2026 consensus at 1.22 implies 4% upside.
- 04Watch ECB rhetoric for confirmation of hawkish shift to sustain the rally.
Market implications
Next resistance sits at 1.1750, a key Fibonacci level; a break above could open a run to 1.1800 (March consensus midpoint). The ECB meeting minutes due this week will be pivotal — any dovish lean could quickly reverse the move. Our consensus suggests limited downside below 1.1650 given firm support from the median target.
Risks to this view
A re-escalation in energy prices or a deeper eurozone contraction, especially in Germany, would undermine the resilience story. Also, if the Fed pivots hawkish again, the USD could regain strength and drag EUR/USD back below 1.15. Spot breaking below 1.1600 would invalidate the technical support narrative.
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.