The USD has treaded water in recent months. We still expect the next leg to be lower, coming from an eventual dovish Fed pivot to easing. We expect this to materialise over Q4 followed by rate cuts next year.

Our year-end forecast for EURUSD remains at 1.15. The good news on the Euro side appears now to be in the price, with falling US yields the biggest potential driver for a move higher.

EUR/USD – Q3 2023 1.12 Q4 2023 1.15 Q4 2024 1.25