Immediate forecasts for the euro are being driven entirely by the Russian invasion of Ukraine and the impact on energy prices. This continually updated article reviews EUR bank forecasts and popular cross-rate trends.
BER Research The euro has recovered since falling below the US dollar exchange rate in September, aided by lower energy prices, reduced recession fears, and a more aggressive European Central Bank. The euro has risen 13% over the past 3.5 months, aided by a weaker US dollar.
| Date | EUR/USD | Change | Period |
|---|---|---|---|
17 Jan 2023 | 1.0792 | 0.7% ▲ | 2 Week |
02 Nov 2022 | 0.9814 | 10.7% ▲ | 3 Month |
31 Jan 2022 | 1.1229 | 3.2% ▼ | 1 Year |
01 Feb 2018 | 1.2511 | 13.1% ▼ | 5 Year |
02 Feb 2013 | 1.3624 | 20.2% ▼ | 10 Year |
05 Feb 2003 | 1.0834 | 0.3% ▲ | 20 Year |
The US Federal Reserve had increased its policy rate last year, attracting investors and strengthening the dollar, while also denting the euro’s appeal due to economic concerns in Europe.
However, this trend has reversed recently, as investment flows back to economies outside the US, and prospects for Europe have improved with falling natural gas prices and reduced recession fears.
The euro last year dropped below parity vs greenback, for the first time in two decades, over the impact of Russian oil and gas threats plus uncertainty over ECB interest rate plans.
EUR to CHF at 0.9962 is just 0.7% above its 90-day average 0.9897 with range 0.9741-1.0067. EUR to CHF
At the start of the tragic Russian invasion of Ukraine the euro sank to parity against the safe-haven Swiss franc hitting 0.9985 francs per euro on March 7th, the lowest since January 2015.
GBP to EUR at 1.1324 is 1.0% below its 90-day average 1.1444 with range 1.1253-1.1673. GBP to EUR
In October, the GBP/EUR rate is still well down from the 1.20 levels, seen at the start of the year, to the 1.13-15 levels (1 EUR = 0.88 GBP).
This is some achievement given the Euro itself has been under heavy pressure itself from impact on gas prices by the war in Ukraine.
The BoE’s (UK central bank) gloomy economic forecasts has also increased pressure on Sterling.
AUD to EUR at 0.6501 is 1.1% above its 90-day average 0.6432 with range 0.6287-0.6577. AUD to EUR
AUD/EUR reached a 5-year high in late August near 0.70, but has fallen back below 0.64/0.65 into 2023 – more due to AUD weakness than euro strength.
With the Eurozone’s reliance on gas from Russia, the euro remains vulnerable with Putin’s so called Russian ‘special military operation’ in Ukraine.
CAD to EUR at 0.6904 is 1.9% below its 90-day average 0.7037 with range 0.6841-0.7462. CAD to EUR
In the final quarter of the year CAD/EUR is trading around the 0.74-0.76 level, this a few percent down from the start of the year.
The effect of Ukraine crisis on energy prices hurts the euro and helps the gas and oil exporting Canadian dollar.
You can also read our full Foreign Exchange Guide to the Eurozone.
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Disclaimer: Please note any provider recommendations, currency forecasts or any opinions of our authors should not be taken as a reference to buy or sell any financial product.