Euro: Spreads support upside bias against US Dollar – Scotiabank
Scotiabank's recent insight emphasizes the Euro's potential upside against the US Dollar, supported by positive spread developments. This view highlights the Euro's resilience amidst uncertainty, reinforcing an upward trajectory in expectations. With consensus forecasts clustering around the 1.17 level for March 2026, this analysis underscores the growing institutional interest in the EUR/USD pair. Overall, the desk sees a cautious, yet optimistic sentiment towards the Euro as conditions evolve.
Where it sits in our coverage
Our consensus EUR/USD target currently sits at 1.1700 (median across firms for March 2026), with Morgan Stanley at the upper bound (1.2000) and RBC at the lower (1.1600). Scotiabank's perspective aligns with this sentiment as the market increasingly anticipates stronger support for the Euro against the Dollar.
How firms align
Several firms share bullish expectations for the EUR/USD, including JPMorgan and Deutsche Bank, both targeting 1.1800 for March 2026. In contrast, firms like MUFG and TMG continue to project more conservative estimates, indicating a range of sentiments within the market. For more details, check our latest reports on JPMorgan and Deutsche Bank.
What the data shows
Recent forecast revisions from ING and Deutsche Bank have further supported the upward bias, with both firms adjusting their March predictions to 1.1700 and 1.1800, respectively. This aligns with our consensus and reflects a broader positive shift in expectations for the Euro, as highlighted in our research on the ECB's policy path (/research/eurusd-ecb-rate-path-2026-08-16).
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD consensus target moves up to 1.1700 for March 2026.
- 02Bullish positioning among firms is increasing towards the Euro.
- 03Watch for developments around ECB policy that could shift sentiment.
- 04Alignment among institutions indicates a growing confidence in Euro strength.
Market implications
Market participants should closely monitor resistance levels around 1.1500 and 1.1600, with upcoming ECB announcements likely influencing sentiment. The consensus number of 1.1700 serves as a key target to watch for potential breakout signals.
Risks to this view
A shift in the ECB's stance towards tightening monetary policy could reverse the current bullish sentiment towards the Euro. Additionally, adverse economic indicators from the Eurozone may pose significant risks to the expected upside.
Sentiment by currency
USD EUR+JPY~GBP~Composite USD score: -0.55
Firms mentioned
Sources & References
How we cover this story
Other coverage on this pair
Euro returns below 1.1600 as US Dollar selling pressure eases
Euro: Bullish momentum eyes mid‑1.17s against US Dollar – Scotiabank
EUR/USD bullish momentum targeting 1.17 mid-levels suggests positioning for further dollar weakness if technical breaks hold.
EUR/USD Price Forecast: Conquers 1.1600 as bulls retain control above 100-SMA, 50% Fibo.
EUR/USD technical break above 1.1600 and 100-SMA signals continuation risk; monitor for resistance targets above current levels.