Bank of America (BofA) expects the EUR/USD to rise to 1.10 by the end of 2025, exceeding the market consensus of 1.05.
Key Forecast Highlights
🔹 Near-Term USD Strength, Long-Term Weakness: The dollar is expected to hold strong in Q1 2025 before gradually depreciating.
🔹 Euro's Underappreciated Upside Risks: Potential German elections, EU reforms, and higher European defense spending could boost the euro.
🔹 US Dollar "Priced to Perfection": BofA warns that the USD's strength may be overestimated, with risks from inflation and fiscal policy shifts.
🔹 Trade & Capital Flow Implications: A strong USD could negatively impact capital flows and weaken equity performance in the US.
Tracking EUR/USD Market Trends
- Forex Daily API - Get real-time EUR/USD exchange rate updates.
- Economics Calendar API - Stay ahead of key economic events affecting forex markets.
Final Thoughts
BofA's 1.10 target for EUR/USD signals confidence in euro resilience and potential US dollar weakness in late 2025. However, near-term risks like US policy shifts and European economic stability will remain key drivers.
