On Friday, EUR/USD moved to its lowest levels since last July. As the pair looks set to reach the 1.14 level sooner than expected by economists at Rabobank, the common currency faces a bleak outlook ahead.

USD to remain on the front foot in the months ahead

“The uptrend that has been in place since June remains in place and we expect the USD to remain on the front foot going forward into 2022.”

“We expect the cautiousness of the ECB on policy to limit recovery prospects for the EUR vs. USD in the coming months.”

“Our current mid-2022 forecast of EUR/USD 1.14 is looking outdated, with the currency pair looking set to achieve this level sooner than we had expected.”  

“This week the USD is likely to be focused on the release of US October retail sales data, production number and various activity indices, in addition to comments from various Fed speakers. We would continue to favour selling EUR/USD into rallies.”