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George Ma
in
Forex
April 9 09:00

Euro will fall to 99 US cents by the end of the year

Bank waits for euro at 1 dollar by September, 99 cents by end 2020.
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Euro seems to fall by another 8% or so, leading to parity or below US dollar at the end of this year, according to Australia & New Zealand Banking Group Ltd. That has not been the case since 2002 and that will add up to 3% decline in 2020. The lack of fiscal coordination in the euro zone, in contrast with the combined monetary and fiscal response in other countries justified that prediction, said Brian Martin, senior international economist at the ANZ in London.
The bank expects the euro to fall to 1 US dollar by September and to 99 cents by the end of the year from US$1.0870.
Euro fell this year as the spread of the virus stirred up global markets and increased demand for the US dollar. Although US$1.05 is the key support for the euro, Martin believes that this level will be overcome in the coming months.
He also expects that the US policy will support national currency, reinforcing the weakness of the euro. According to Martin, the unlimited quantitative easing of the Federal Reserve means that USA has a ready buyer for an increased treasury bonds issuing, which reduces the need for a higher risk premium or a weaker dollar. The dollar also benefits from restrained inflationary pressures, he said.