Markets will likely again chase the weak USD story once more at the turn of the new year – Nordea

In the FX sphere, the USD lost ground this week. Economists at Nordea analyze Greenback’s outlook.

Don’t sell all your USDs yet

For the USD to continue to decline in the short-term, US data needs to come in even weaker so that markets price in even faster rate cuts. Never say never, but this a tough case to see. However, markets will likely again chase the weak USD story once more at the turn of the new year. 

We see EUR/USD rangebound between 1.05 and 1.12 in the months to come with our target flat around 1.08 until next summer.