Euro fades below 1.1700 as US Dollar rebounds on yields
The Euro has slipped below the key 1.1700 level as the US Dollar strengthens, driven by rising yields. This shift signals potential bearish momentum for EUR/USD as trader sentiment is leaning towards the dollar's unwavering strength amid expectations of tighter monetary policy. As the European Central Bank continues to face challenges, particularly with lower growth prospects, this market revaluation presents an opportunity for further declines in the Euro if support levels crumble.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1700 (median across firms), with firms like RBC and ING sharing this target, while MUFG skews bullish at 1.2600. This positioning reflects a broader expectation of moderate support for the Euro against a strengthening dollar.
How firms align
RBC and Stanchart align closely with this downward sentiment, projecting targets of 1.1700 and 1.1600 respectively by March 2026. In contrast, firms like Nomura and MorganStanley present a more bullish outlook, expecting the Euro to reach 1.1700 and 1.2000 by the same date, highlighting divergence in market views.
What the data shows
Recent forecast revisions from UOB and Deutsche Bank suggest a downward trend, with UOB adjusting their March 2026 target to 1.1536 amid shifting market dynamics. Our published research indicates that the consensus has been slowly inching down, reflecting growing concerns about the Eurozone’s economic capabilities against increasing US rates. See our insights in /research/eurusd-ecb-rate-path-2026-08-20.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD slips below 1.1700, reflecting bearish sentiment.
- 02Increasing US yields are reinforcing Dollar strength.
- 03Watch for breaks below 1.1700 to indicate further Euro weakness.
Market implications
Traders should keep an eye on the 1.1700 support level in EUR/USD; a confirmed break could energize bearish positions. The consensus target remains at 1.1700, indicating a critical level for near-term positioning decisions.
Risks to this view
A reversal could occur if incoming economic data from the Eurozone surprises positively, coupled with a pullback in US yields. Additionally, any unexpected dovish signals from the ECB may bolster the Euro significantly, challenging the current bearish outlook.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
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