EUR/USD broke to a new cycle low. Economists at ING expect the world’s most popular currency pair to reach parity in July.

Parity beckons

“German Bundesbank estimated that the German economy could take a hit of 5% of GDP in the case of gas being rationed. It feels like we are now not far away from such a scenario.”

“EUR/USD looks likely to drift towards parity this month. The trade-weighted euro is a whisker away from the lows of the year and an ECB response to threaten more aggressive rate hikes may prove counter-productive for a pro-cyclical currency such as the euro.”

See – Euro: Forecasts from eight major banks, on parity watch over the coming months