Economists at Société Générale note two important things needed to propel EUR/USD into a 1.15-1.20 range.
The Euro needs more growth
US economists kept their forecasts for 2023 GDP growth unchanged, as was the case for most G7 economies. The exception is the eurozone, where the consensus hike to 2023 fell slightly this month. It is hard to see how the euro can rise at the recent pace of growth expectations.
A push to a 1.15-1.20 EUR/USD range probably requires two things – an improvement in expectations about Eurozone GDP growth and a stronger belief that the ECB will continue hiking rates after the Fed has finished.
