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FX BANK FORECAST · COVERAGE
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Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 38 institutional desks. No promotion.
FX BANK FORECAST · COVERAGE
Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 38 institutional desks. No promotion.
Political risks are weighing heavily on the euro's outlook, with Deutsche Bank highlighting uncertainties that could hinder its upward trajectory. These risks come amid a backdrop of firm consensus for a gradual strengthening of the euro against the dollar in the medium term, suggesting a potential divergence between current market conditions and future expectations.
Deutsche Bank's recent commentary emphasizes that political uncertainty across Europe is clouding the euro's outlook, specifically against the dollar. This commentary highlights risks that might pressure the euro lower, countering the consensus forecast for a gradual appreciation against the greenback in the coming months.
As a guiding expectation, the EUR/USD consensus target reflects a growth outlook with significant support from various market participants. The political landscape, however, presents a compelling counter-argument suggesting that the anticipated euro strength could falter if uncertainties escalate further, diverging from market forecasts.
Currently, our consensus target for EUR/USD stands at 1.1800 for March 2026, suggesting broad alignment among surveyed firms despite the surrounding risks. Consensus remains strong within a range of 1.1700 to 1.2000, indicating optimism that may not yet fully incorporate emerging political challenges detailed by Deutsche Bank.
Specific firms with aligned targets for December 2026 include:
While Deutsche Bank articulates cautious sentiment, several firms maintain a more positive outlook for the euro's trajectory. Goldman and MUFG project higher valuations for EUR/USD into late 2026, reflecting confidence in economic recovery and stability.
Conversely, firms like BofA express more skepticism, reflecting a contrary view by setting a lower target amid the evolving political landscape.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
Market implications
The prevailing political risks could lead to increased volatility in the EUR/USD pair, necessitating close monitoring of geopolitical developments. Should uncertainty prolong or escalate, the euro might struggle to meet consensus targets, potentially prompting a reassessment of forecasts by various institutions.
Risks to this view
Key risks to the euro include the potential for heightened political instability, economic data underperformance, or unexpected central bank policy shifts. Any deterioration in sentiment could lead to downward revisions in targets and increased sell-off in the euro, diverging from the current optimistic consensus.
| Firm | Stance | YE 2026 |
|---|---|---|
Rabobank | Bearish | 1.1000 |
ING | Bullish | 1.1300 |
MUFG | Neutral | 1.1200 |
All 31 desk targets for EUR/USD
How we cover this story
USD resilience despite US political uncertainty suggests safe-haven demand remains the dominant driver; EUR/USD breakdown below 1.1200 month-range may accelerate if risk sentiment deteriorates.
EUR/USD upside capped by continued dollar cash rotation despite US tech weakness; Treasury correlation reassertion limits euro tactical strength.
EUR/USD breaks below 1.1200 technical level ahead of data events; watch for Eurozone retail sales and US nonfarm payroll reactions.
USD strength contingent on NFP data; break of 102.10 DXY would confirm momentum toward EUR/USD 1.1100 support.
EUR/USD spot sits 2.69% below the 31-firm median Dec-26 target of 1.145, with a 0.135 dispersion range signalling deep disagreement on the path ahead.
EUR/USD spot sits 2.19% below the 31-firm median Dec-26 target of 1.15, with a 0.135 dispersion range signalling deep disagreement on the path ahead.
EUR/USD spot at 1.1191 sits 2.68% below the 31-firm median Dec-26 target of 1.15, exposing a consensus that remains structurally bullish despite tape underperformance.
31 investment banks see EUR/USD at 1.1469 by Dec 2026
View the live EUR/USD forecastStanChart |
Danske |
TMGM |
UOB |