Economists at Goldman Sachs discuss EUR/USD outlook.

Total Dollar depreciation for the year to be more constrained than commonly anticipated

“Unless there is more evidence of divergence in favor of the Euro-area, it is unlikely that the EUR/USD will break the recent range towards the topside.”

“We have maintained a year-end target of 1.10 throughout the year, a level that has already been tested twice but has retracted both times as the market reassessed the relative policy path. We expect this oscillation to persist. Our global forecasts imply there is likely more room for Dollar strength in the near term than what the market is currently pricing in, and we believe the total Dollar depreciation for the year will be more constrained than commonly anticipated.”