MUFG Euro To Dollar Forecast: EUR/USD At 1.26 In Next 12 Months - Exchange Rates UK
MUFG has projected a bullish outlook for the EUR/USD pair, forecasting a target of 1.26 over the next year. This contrasts with a more conservative consensus among other institutions, which generally expect the pair to hover around 1.18 to 1.22 during the same horizon.
What the desk is arguing
The desk acknowledges MUFG's optimistic stance on the EUR/USD forecast, which suggests significant appreciation from the current spot of 1.1500 to 1.26 within 12 months. Given the recent trends in Eurozone data and potential stabilization in the global economy, such a trajectory could be plausible if economic fundamentals align favorably.
Supporting evidence from recent consensus projections indicates that while many firms are revisiting their EUR/USD targets upward, MUFG's target remains notably higher than the prevailing market expectations, signaling an anticipated divergence in performance.
The desk implicitly challenges the notion that the EUR/USD will remain limited in its growth potential, suggesting that factors such as changing monetary policy actions by the ECB and improved economic data blooms in Europe could foster a more robust currency environment than currently predicted.
Where it sits in our coverage
Our current consensus target for EUR/USD is 1.2200 by December 2026, with a tight spread among major firms ranging from 1.1700 to 1.2500. This positions MUFG's forecast substantially above the median, suggesting a more aggressive recovery in the Eurozone than is commonly anticipated.
Specific targets from select firms demonstrate this discrepancy:
- Goldman: Dec26 1.2500
- Deutsche Bank: Dec26 1.2500
- MUFJ: Dec26 1.2400
How other firms see it
The overall sentiment regarding the EUR/USD is mixed, with several firms agreeing on a more cautious approach while a few align with MUFG's optimistic forecast. Notable firms that align include:
- Goldman (Dec26 target 1.2500)
- Deutsche Bank (Dec26 target 1.2500)
Conversely, firms like JPMorgan and BofA hold more conservative views with targets of 1.2000 and 1.2200 respectively, suggesting that they foresee limitations to the euro's upward trajectory in the near term.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01MUFG predicts EUR/USD will reach 1.26 in 12 months.
- 02Current consensus targets range from 1.1700 to 1.2500.
- 03The outlook among major firms reveals significant variability in EUR/USD expectations.
Market implications
If MUFG's forecast holds, it could prompt a reevaluation of positions in the EUR/USD, potentially pushing investors towards a bullish stance on the euro and away from the dollar. Additionally, should economic indicators in the Eurozone improve, it may catalyze upward pressure on the EUR in the near term.
Risks to this view
The primary risks to MUFG's forecast include unexpected shifts in U.S. monetary policy, geopolitical tensions impacting the Eurozone, and any adverse economic data releases that could dampen growth prospects in the region.
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
UBS | Bullish | 1.1600 |
ING | Bullish | 1.1300 |
Société Générale | Bearish | 1.1000 |
All 29 desk targets for EUR/USD
Sources & References
How we cover this story
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Cross-firm research
EUR/USD Consensus vs Spot Gap: Week of October 23, 2026
EUR/USD spot sits 3.35% below the 31-firm median Dec-26 target of 1.16, leaving consensus firmly bullish while price action lags.
EUR/USD Consensus vs Spot Gap: Week of October 22, 2026
EUR/USD spot sits 3.36% below the 31-firm median Dec-26 target of 1.16, with a 0.135 dispersion range signalling deep disagreement on the Fed-ECB rate path.
EUR/USD Consensus Check: Spot at 1.1232, Median Target 1.16 — Week of October 21, 2026
EUR/USD trades 3.17% below the 31-firm median Dec-26 target of 1.16, with a 0.135-wide dispersion range that signals deep disagreement on the Fed-ECB policy path.