EUR/USD Weekly Forecast: US Dollar future in the hands of Kevin Warsh
The fate of the US Dollar now hinges on insights from Kevin Warsh, a key figure in the current economic landscape. His perspective is particularly critical as the market grapples with diverging views on monetary policy and the future trajectory of interest rates. Current price action around EUR/USD, sitting at 1.1253, reflects an ongoing struggle amidst these uncertainties, with market participants closely monitoring upcoming comments or decisions from Warsh that could sway sentiment. The implications of his stance will be pivotal for traders as they position their portfolios heading into year-end.
Where it sits in our coverage
Our consensus EUR/USD target currently sits at 1.1700 (median across various firms), with targets stretching from a low of 1.1200 by TMG and Lloyds to a high of 1.2200 from CIBC. This divergence underscores the market's indecision, as participants weigh potential shifts in monetary policy against current economic indicators.
How firms align
While the market is waiting for clarification from Warsh, Rabobank and Nomura align closely with a more optimistic forecast, both targeting 1.1700 for March 2026. On the contrary, firms like TMG and Mizuho appear more pessimistic, with targets around 1.1300 − 1.1500. This split reflects a broader uncertainty in the market about the US dollar's trajectory following potential policy shifts.
What the data shows
Recent forecast revisions also demonstrate this divergence, with BofA revising lower to 1.1500 for December 2026, while Rabobank holds a firmer stance at 1.1800, highlighting the contrasting views. For further context, see our insights in /research/eurusd-ecb-rate-path-2026-10-15.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01Markets eye Kevin Warsh's influence on USD direction.
- 02EUR/USD currently at 1.1253, amid economic uncertainty.
- 03Consensus target for MAR26 is 1.1700, indicating potential upward movement.
- 04CIBC's target of 1.2200 suggests bullish sentiment among some firms.
Market implications
Investors should watch the EUR/USD closely, particularly as we approach the next Fed meeting and potential statements from Warsh. The consensus level of 1.1700 could serve as a key resistance point or target for traders looking for directional cues.
Risks to this view
A reversal could occur if Warsh adopts a more hawkish tone than anticipated, which may strengthen the USD against the EUR. Additionally, disappointing US economic data could negate the consensus bullish outlook and lead to lower valuations.
Sentiment by currency
USD~EUR~JPY~GBP~Composite USD score: +0.00
Sources & References
How we cover this story
Other coverage on this pair
EUR/USD Price Forecast: Recovery remains fragile below key moving averages
EUR positioned below key technical resistance with limited upside catalysts suggests USD strength may persist in near-term EUR/USD dynamics.
Euro recovers further against US Dollar amid AI sell-off narrative
Risk-off rotation from mega-cap AI stocks may be redirecting flows away from USD carry trades, supporting EUR/USD above recent support levels.