EUR/OMR Outlook:
Slightly positive, but likely to move sideways, as the rate is above its recent average without a clear driving force.
Key drivers:
• Rate gap: The European Central Bank (ECB) maintains steady interest rates, while the Central Bank of Oman is focused on stabilizing its economy with fixed rates.
• Risk/commodities: Oil prices are above average, which typically supports the Omani Rial due to its oil-exporting economy, potentially stabilizing the EUR/OMR rate.
• One macro factor: Latest data shows Eurozone inflation at 1.7%, below the ECB’s target, raising questions about further rate adjustments.
Range:
The EUR/OMR pair is likely to drift within its recent 3-month range, lacking significant impetus for movement in either direction.
What could change it:
• Upside risk: A surprise shift in ECB policy or stronger-than-expected Eurozone economic data could boost the Euro's appeal.
• Downside risk: Continued weak industrial performance in Germany or signs of deeper economic troubles in the Eurozone could lead to a decline in the Euro's value.
