What are AUD to EUR forecasts?
In recent weeks, the Australian Dollar (AUD) experienced a brief setback due to a risk-averse market atmosphere, but managed to regain its strength in the European session. FX analysts attribute this bounce-back to factors such as changes in commodity prices, trade policies, and political developments, which tend to have a significant impact on the AUD's value. The ongoing contraction in manufacturing activity, as highlighted in PMI surveys, could pose a threat to the currency. However, the market view seems optimistic, as the Australian Financial Review's survey projects the Aussie dollar to reach 0.71 USD by the end of 2023, with the first rate cut expected in early 2024.
On the other hand, the Euro (EUR) showed no clear direction recently, though a downbeat market mood lent some support to the generally safe single currency. Nevertheless, factors such as the stronger US Dollar (USD) and weaker-than-expected consumer confidence readings have placed pressure on the Euro. The recent drop in the value of the Euro below parity against the greenback has further intensified concerns due to factors like Russian oil and gas threats and uncertainty over European Central Bank interest rate plans. The AUD to EUR exchange rate, currently at 0.6143, remains just below its 3-month average, wavering within an 8.3% range from 0.5943 to 0.6439. FX analysts and economists will be closely monitoring the Eurozone's economic performance and any weakening in private sector activity to gauge potential headwinds facing the single currency.