EUR/USD Weekly Forecast: To hike or not to hike? Kevin Warsh between a rock and a hard place
In the recent EUR/USD analysis, the focus is on the conflicting perspectives surrounding monetary policy as Kevin Warsh finds himself navigating complex pressures. Given the current spot at 1.1446, market participants are debating whether the European Central Bank (ECB) will maintain or adjust its interest rate strategy amidst faltering economic indicators. This assessment is crucial as any missteps in communications could significantly impact the euro's trajectory against the dollar.
Where it sits in our coverage
Our consensus EUR/USD target currently resides at 1.1700 for March 2026, with a range spanning from 1.1200 to 1.2000 among 12 firms. Notably, Morgan Stanley's bullish stance peaks at 1.2000 while Danske Bank presents the most conservative forecast at 1.1100.
How firms align
Several firms like SocGen and Nomura align with the headline's cautious tone, projecting targets at 1.1700 for March 2026. In contrast, firms such as HSBC maintain a neutral outlook at 1.1700, reflecting uncertainty in the near term. More detailed forecasts are available in our internal reports, such as /research/eurusd-ecb-rate-path-2026-09-11.
What the data shows
Recent forecast revisions have seen Scotiabank adjust its target to 1.1734 for March 2026, while other firms remain slightly more conservative, as seen in UBS's unchanged projection of 1.2000. For further insights, see /research/eurusd-ecb-rate-path-2026-09-10.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01Current EUR/USD spot at 1.1446 close to firm targets.
- 02Traders are weighing ECB signals against Fed policy implications.
- 03Upcoming ECB meeting could shift consensus towards the 1.17 target.
Market implications
The EUR/USD pair remains sensitive to ECB commentary, especially with the next meeting on the horizon. With our consensus target sitting at 1.1700, any hawkish signaling could see a revisit to levels above 1.1600.
Risks to this view
A failure to hike rates or a dovish outlook from the ECB could lead to a downward adjustment of the euro, potentially testing the lower target of 1.1200 as detailed by Danske Bank.
Sentiment by currency
USD~EUR~JPY~GBP~Composite USD score: +0.00
Sources & References
How we cover this story
Other coverage on this pair
Euro steadies against US Dollar after volatile reaction to US CPI
EUR/USD Price Forecast: Likely find direction after US CPI data
Euro: Downside risks while 1.1585 holds against US Dollar – UOB
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