Danske Research discusses EUR/USD outlook and maintains a structural bias in the medium-term.
"EUR/USD. Recent Fed comments further convince us that Fed rate cuts are coming from July. The ECB is also set to deliver a package of easing measures in September.
In the end, Fed easing will be more forceful and the Fed-ECB monetary policy divergence should pave the way for a higher EUR/USD over the coming 6M. We forecast EUR/USD at 1.14 in 1M and 1.15 in 3M. We forecast EUR/USD at 1.17 in 6M and 1.17 in 12M, all unchanged from last month,"Danske projects.
"The Fed initiating an easing cycle would do most of the lifting for 1-3M, while for 3-6M a US-China trade deal should weaken USD," Danske adds.