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FX BANK FORECAST · COVERAGE
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Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 30 institutional desks. No promotion.
FX BANK FORECAST · COVERAGE
Aggregated year-end forecasts, scenario shifts, and curated analyst notes from 30 institutional desks. No promotion.
ING revises its EUR/USD forecast to 1.22 in 12 months, joining the consensus view that the euro will strengthen from current levels. The bank sees the pair recovering as the ECB reaches peak hawkishness and the Fed begins to ease, narrowing interest rate differentials. ING also points to improving eurozone growth prospects, supported by fiscal spending and resilient domestic demand.
This bullish view rejects the bearish narrative that the euro is structurally weak. It implicitly argues that the current discount to fair value will close as the market reprices ECB policy and the US fiscal outlook deteriorates. The firm's forecast sits near the middle of the consensus range, suggesting a balanced risk-reward for long positions.
Our EUR/USD consensus for Dec-26 is 1.2200, based on the median of eight major bank forecasts. That's exactly where ING sits, making their call a consensus-aligned stance. The range of forecasts is wide, from 1.1600 (Morgan Stanley) to 1.2500 (Goldman Sachs), reflecting deep uncertainty about the medium-term trajectory. Spot at 1.1500 trades well below any firm's Dec-26 target, implying a significant expected appreciation.
Specific firm targets for Dec-26 include: - Goldman Sachs: 1.2500 - MUFG: 1.2400 - Deutsche Bank: 1.2500 - ING: 1.2200 - BofA: 1.2200 - Barclays: 1.2100 - JPMorgan: 1.2000 - Morgan Stanley: 1.1600
Most banks are aligned with ING's bullish view, though with varying conviction. Goldman Sachs and Deutsche Bank are more aggressive at 1.25, while MUFG sits at 1.24. These firms likely share the view that EUR weakness is overdone and a reversion to fair value is due. JPMorgan at 1.20 and Barclays at 1.21 are more cautious but still above spot.
On the contrary side, Morgan Stanley stands out with a Dec-26 target of just 1.1600, implying EUR essentially flat from current levels. They argue that US exceptionalism and tariff risks will persist, capping EUR/USD gains. This minority bearish view presents a key risk to the consensus bullish narrative, and traders should watch for any shift in Morgan Stanley's stance as it could signal a broader change in sentiment.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
Market implications
The consensus bullish EUR/USD view supports a long bias, but the wide range (1.16-1.25) suggests high uncertainty. The gap between spot and consensus may attract carry and valuation traders, but execution requires patience. A close above 1.20 could trigger momentum buying.
Risks to this view
Downside risks include hawkish Fed repricing, escalation of US tariffs, or a eurozone recession. Upside risks include faster ECB cutting or a US fiscal crunch. Morgan Stanley's bearish stance highlights that the consensus may be too optimistic on eurozone growth.
| Firm | Stance | YE 2026 |
|---|---|---|
UOB | Neutral | 1.1450 |
Citi | Bearish | 1.1000 |
MUFG | Bullish | 1.1800 |
All 28 desk targets for EUR/USD
How we cover this story
EUR/USD rebound capped by technical resistance suggests limited near-term upside for euro weakness trades.
Widening EUR/USD yield spreads in favor of eurozone assets suggests technical support for mean reversion; monitor if 10Y differential sustains above 100bp.
ING assessment of constrained EUR upside signals limited momentum for euro strength; USD positioning likely remains defensive.
EUR/USD spot at 1.1415 sits 2.85% beneath the 28-firm median Dec-26 target of 1.1750, with a 0.20-figure dispersion range exposing deep macro disagreement.
EUR/USD spot sits 2.85% below the 28-firm median Dec-26 target of 1.1750, exposing a consensus that remains structurally bullish on the euro.
28 investment banks see EUR/USD at 1.1736 by Dec 2026
View the live EUR/USD forecastJPM |
Danske |
UBS |
BofA |