The market is pricing three 75bp rate cuts from the Fed and ECB this year and what matters is firstly how those expectations evolve and secondly, how expectations about policy evolve for 2025. 

For now, EUR/USD is marginally more likely to drift higher than to fall much, as gradual synchronised easing reduces the appeal of the dollar. But a big EUR/USD rise is very unlikely now, because it would require significantly more Fed than ECB easing.

By contrast, the risk into 2025 is that the Fed tightens again, long before the ECB does. That would echo the experience of the Great Moderation, when 1995 rate cuts were reversed in 1997, and 1998 cuts were reversed in 1999/2000. That’s the last time the Dollar was at current levels in trade-weighted terms.