US Dollar Forecast

Peak Dollar strength has passed and the Euro will show bullish traits in the medium-term shows new research from French banking giant BNP Paribas.

The Dollar will turn tail and retreat from around mid-year says analysts at Westpac.

"For us, the fact that the USD has risen into the rarified levels seen in Mar 2020 is not in of itself a reason to fade it" - Credit Suisse.

The Euro to Dollar exchange rate entered the new week close to five-year lows following a dire April month but could attempt a corrective rebound in the days ahead if the Federal Reserve (Fed) kicks a quantitative tightening, or QT, can down the road into the summer months. 

The Euro can avoid a fall to parity against the Dollar, although the odds of this are decreasing say analysts.

"The regime of softer growth-higher inflation outlook has persisted and remains supportive of USD strength" - JP Morgan.

Foreign exchange strategists at DNB Markets say the Euro's foray below the 1.08 USD marker won't last long and they expect a steady recovery into year end.

The Pound to Dollar rate entered the new week testing a major level of support on the charts and with only limited recovery prospects following a lengthy run of losses, while further declines remain a possibility due to an increasingly aggressive Federal Reserve (Fed) monetary policy stance. 

The Euro could fall to par the Dollar, or rise back to 1.15 says Italian lender UniCredit who see one of two scenarios playing out over coming weeks.

"The US dollar could be close to peaking" - MUFG.

Western Union Business Solutions says GBP/USD could be poised to make a decisive break below 1.30 this week.

The Euro to Dollar exchange rate entered a holiday-shortened week close to its 2020 lows but could now find itself better supported if the People’s Bank of China (PBoC) comes to the aid of the European single currency in a bid to stymie further unwanted strength in the trade-weighted Renminbi.

The Pound to Dollar exchange rate remains suppressed and at risk of further lurches below 1.30 over the coming days due to continuing strength of the U.S. Dollar and likely side effects of a possible People’s Bank of China (PBoC) effort to fend off unwanted strength in the Renminbi.

The Pound to Dollar exchange rate could only make a meaningful rebound around the middle of 2022, according to new analysis.

GBP/USD vulnerable & could slide below 1.30, risks further slippage toward 1.28 short-term.

GBP/USD upside limited, risks deeper losses ahead as Fed gears up to pull ahead & BoE turns cautious.

EUR/USD steadier & finding feet above 1.0800, calmer global markets supportive of EUR/USD.

GBP/USD vulnerable with Fed, BoE decisions ahead, hangs by thread amid bearish breakdown on charts.

GBP/USD vulnerable to further losses ahead, risk of EUR/USD pulling GBP/USD to 1.3122.

EUR/USD vulnerable near last week’s lows, slip below 1.1107 brings 1.1002 into view.