We expect EUR/USD to fall to 1.02 by the end of the year, driven by defensive investor bias, positive carry, and slow local growth. This trend is somewhat mitigated by the ongoing shift in capital flows.

However, we expect the Euro to outperform its regional peers. We maintain a long-term bullish bias for EUR/GBP, forecasting it to rise above 0.90 over the next 12 months as capital repatriation into Europe significantly contrasts with the lukewarm investor demand for UK investments.

We expect EUR/CHF to marginally increase toward parity, with the Euro's positivity partly countered by the defensive allure of the Swiss Franc.