Economists at ANZ Bank expect the Euro to struggle in the first months of 2023 but expect EUR/USD to recover later and end the year at 1.06.

Recession risks could add pressure on the Euro

“We expect risk sentiment and the final leg of the USD rally to drive the market in H1 2023.”

“Recession risks are not fully priced in and could add pressure on the EUR.”

“Once the US is close to completing its hiking cycle in early to mid-2023, we expect the EUR to appreciate, trading in line with underlying fundamentals.”

“We expect the EUR/USD to end 2023 at 1.06.”