Turning bullish on EUR/USD - JPMorgan - Investing.com
JPMorgan has recently shifted its outlook on EUR/USD, becoming bullish on the pair amid expectations of increasing Eurozone economic strength and potential shifts in central bank policies. This optimism is underpinned by the bank's forecasts aligning with a consensus view that suggests a broader appreciation of the euro against the dollar over the next several quarters.
What the desk is arguing
JPMorgan is now projecting an upward trajectory for EUR/USD, revised targets of 1.1800 for March 2026 and 1.2000 for June 2026 signal their confidence in the euro's performance. The firm anticipates that macroeconomic indicators will favor the euro, particularly in light of expected adjustments to monetary policies that may widen interest differentials favorably for the eurozone.
This bullish sentiment implicitly counters the more cautious outlooks from certain firms that suggest potential headwinds stemming from geopolitical risks and U.S. economic resilience. These counterviews highlight the divergence in market perspectives regarding the euro's potential upside, emphasizing specific risks that could impede its ascent.
Where it sits in our coverage
Currently, the consensus median target for EUR/USD stands at 1.1800 for March 2026, closely matching JPMorgan's revised forecast. Other firms also echo this optimism, with the target range spanning from 1.1700 to 1.2000, reflecting a consensus that is largely supportive of a potential euro appreciation against the dollar.
Several notable firms further bolster this viewpoint with their published targets for December 2026, including: - Goldman: 1.2500 - Deutsche Bank: 1.2500 - Morgan Stanley: 1.1600
How other firms see it
The bullish stance from JPMorgan is corroborated by other institutions like Goldman and Deutsche Bank, which also project higher targets for the euro. These alignments suggest a professional consensus is forming around EUR/USD strengthening.
Conversely, some firms maintain a more cautious outlook. For instance: - BofA (targeting 1.2200) reflects skepticism regarding euro appreciation against a robust dollar. - Morgan Stanley presents a more mixed sentiment, targeting a lower 1.1600 for December 2026.
These different expectations highlight the ongoing debate within the market regarding the interplay of economic factors affecting both currencies.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01JPMorgan turns bullish on EUR/USD, revising targets upward amid eurozone strength.
- 02Consensus median for EUR/USD aligns with JPMorgan's forecasts, indicating broader market optimism.
- 03Diverging views among firms reflect contrasting sentiments on euro appreciation potential.
Market implications
An affirmative outlook on EUR/USD could drive increased euro demand, influencing cross-border investments and potentially shifting risk sentiment in favor of euro-denominated assets. Firms adjusting their forecasts to align with a bullish EUR stance might set the stage for increased volatility as market participants respond to evolving macroeconomic indicators.
Risks to this view
Key risks to this bullish outlook include geopolitical tensions that could destabilize the eurozone, as well as stronger-than-anticipated U.S. economic data reinforcing the dollar's strength. Additionally, unexpected changes in central bank policy could disrupt current expectations and challenge the euro's upside momentum.
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
UOB | Neutral | 1.1450 |
Citi | Bearish | 1.1000 |
MUFG | Bullish | 1.1800 |
Sources & References
How we cover this story
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