EUR/USD: A 1.05-1.15 range may prevail in coming months – ANZ

Although the EUR has stabilised recently as the focus turns to peace talks, it is difficult to construct a positive case for the currency. In the view of analysts at ANZ Bank, EUR/USD could fall and stay lower for longer.

Alert to the potential for swings in price action

“The exogenous shock to Europe’s energy supply and urgent need to diversify away from Russia, the sharp deterioration in the region’s terms of trade and intensified supply-chain disruptions are all negatives for the economy.”

“We have cut our 2022 GDP outlook for the euro area by 1.5% and expect the region to lag the US and China in the global growth league tables.”

“We remain very alert to the potential for swings in price action as the market is reactive and awaits greater certainty. A 1.05-1.15 range may therefore prevail in coming months.”