The relative response to the coronavirus pandemic by the Eurozone, US election uncertainty and central bank stimulus initiatives are pushing down the USD to EUR exchange rate in the second half of 2020.
TD Bank told Bloomberg TV on Jan 10 they see the EUR/USD to push below 1.20 (USD/EUR above 0.83) on optimism over the vaccine role out.
Other more optimistic forecasters, believing the ECB’s support of the eurozone economy is working, suggest EUR/USD will test new highs at the very beginning of 2021. If this early test holds they believe EUR/USD will have a good chance of a strong upside trend against the U.S. dollar this year.
USDEUR experienced a sell-off to its yearly lows in mid December as investors moved away from the safe haven of the dollar and into riskier assets, off the back of Biden winning the presidential election and the positive news of COVID-19 vaccine testing.
European Central Bank chief Christine Lagarde announced more stimulus at their December 10 meeting to help the eurozone battle a second coronavirus wave.
A trade deal with the UK could be completed alongside approval of the EU pandemic bonds package, which could pump economic stimulus across the bloc. Based on current conditions, EURUSD will likely trade within a range of 1.20-1.24 (USDEUR 0.80-0.83) in December. Currency Update
USDEUR at 0.8280 is a little below its 90-DAY average, range 0.8112-0.8591.
🔔 USDEUR is at 30-DAY HIGHS.
Alert:30-DAY HIGHS |
Note that forecasts and predictions for the USD/EUR exchange rate change all the time, affected by news events and relative sentiment towards the US and Eurozone economies and this exchange rate is even more volatile than usual because of the uncertainties around the Coranavirus pandemic.
Whether the euro will rise or drop in the future against the US dollar is a difficult question and the answer really depends on many factors. The best way to consider the current USD-EUR relative value is to check the change in the exchange over a range of periods to the present day. The below table does this for periods going back 10 years.
08 Jan 2021
16 Dec 2020
17 Oct 2020
16 Jan 2020
17 Jan 2016
18 Jan 2011
USD/EUR 10 year historic rates & change to 15-Jan-2021 : 0.8278
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