Euro Could Rise as US-Eurozone Rate Differential Narrows -- Market Talk

Dow Jones
2022/11/25

1348 GMT - The euro is likely to rise against the dollar over time as the interest rate differential between the European Central Bank and Federal Reserve narrows, Unicredit Research says. EUR/USD's sensitivity to U.S.-eurozone interest rate differentials remains high and this rate gap looks set to narrow over the over the coming quarters, Unicredit forex strategist Roberto Mialich says in a note. However, the recent rise in EUR/USD has probably been too fast and intense, which exposes the exchange rate to a downward correction to 1.00-1.03 in the near-term amid evidence of a mild economic recession in the eurozone, he says. Unicredit expects EUR/USD to rise to 1.12 by the fourth quarter of 2024. EUR/USD last trades down 0.5% at 1.0364. (renae.dyer@wsj.com)

 

(END) Dow Jones Newswires

November 25, 2022 08:48 ET (13:48 GMT)

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