ANZ, a major bank, presents its perspectives on the short-term and year-end projections for both the Euro (EUR) and the British Pound (GBP).

Key Highlights:

1. EUR Outlook:

   • GDP & Employment Data: These economic indicators will play a crucial role in gauging the flexibility the European Central Bank (ECB) possesses in terms of increasing interest rates without inadvertently driving the economy towards a recession.
   • Implications for EUR: Depending on the outcomes of these data releases, they will influence the medium-term forecast for the EUR.
   • EUR Strength: ANZ anticipates that the EUR will exhibit resilience when juxtaposed with other G10 currencies, notably against the Japanese Yen (JPY) and the GBP.

2. GBP Outlook:

   • Consumer Price Index (CPI) Reading: A reading that falls short of expectations will likely exert downward pressure on the GBP as the week concludes.
   • GDP & Wages Data: ANZ suggests that any strength observed in the GDP and wage data will provide some level of support for the GBP, acting as a counterbalance to potential CPI-induced weaknesses.

3. Year-End Targets:

   • EUR/USD: ANZ sets its year-end target for the EUR/USD exchange rate at 1.14.
   • GBP/USD: For the GBP against the USD, the bank's year-end prediction stands at 1.30.

Conclusion:

ANZ underscores the importance of forthcoming economic data in shaping the trajectories of the EUR and GBP. For the EUR, GDP and employment statistics will be paramount in determining the ECB's maneuverability concerning rate hikes, while for the GBP, CPI, GDP, and wage data will be pivotal. In terms of year-end forecasts, ANZ anticipates the EUR/USD pair at 1.14 and the GBP/USD pair at 1.30.