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Sep 02 - 02:55 PM

EUR/USD: Will Look To Buy Dips Into 1.17 Targeting 1.25-1.35 Range On 2-3 Years Horizon - SocGen

By eFXdata  —  Sep 02 - 01:30 PM
Societe Generale is looking to buy EUR/USD dips strategically targeting 1.25-1.35 over a 2-3 years horizon.
 
"ECB Chief Economist Phillip Lane said that ‘the currency ‘feeds into our global and European forecasts and that in turn does feed into our monetary policy settings'.
The timing is good - intervention, verbal or otherwise, works best when the market is over-positioned, which is definitely the case today. But, the implicit threat is empty. Partly, because the EUR/USD is merely back to its average level since 1999, so it's only over-stretched, in the short term. And because the ECB may not be able to ease in a way that weakens the euro," SocGen notes. 

""In the meantime, maybe an over-stretched market, and perhaps a rethink on relative growth prospects or even a rethink on the odds of President Trump being re-elected, will trigger a decent EUR/USD correction (to 1.17?) But will be a buyer if it does, looking for a move into a 1.25-1.35 range on a 2-3-year horizon," SocGen adds. 

Source:
Société Générale Research/Market Commentary

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