TWD to EUR 2025 Forecasts

05 JunThe euro (EUR) has seen recent support from positive PMI data, which indicated a move out of contraction territory in the Eurozone’s private sector activity, thereby propelling the currency against weaker peers. Analysts suggest that, despite this positive momentum, the euro faces potential vulnerabilities influenced by the upcoming decisions from the European Central Bank (ECB). With market expectations already factoring in an interest rate cut, any dovish signals from the ECB could lead to a depreciation of the euro.

The euro's stability continues to be impacted by various geopolitical factors, notably the war in Ukraine. Ongoing sanctions on Russia and associated energy supply disruptions have contributed to volatility in the euro's value. As the conflict extends into 2025, uncertainties regarding EU support for Ukraine and reconstruction efforts weigh heavily on economic sentiment in the Eurozone, making the euro sensitive to developments in energy markets and geopolitical tensions.

For the Taiwanese dollar (TWD), the currency is facing challenges due to elevated tariffs implemented by the US, which could dampen the economic outlook as Taiwan's tech sector is significantly affected by global developments. Increased geopolitical tensions, especially concerning the potential for conflict with China, add further pressure to the TWD.

Currently, the EUR to TWD exchange rate stands at 34.22, approximately 3.4% below its three-month average of 35.41. This indicates a period of volatility, with the rate trading within a 13.2% range between 33.02 and 37.37. Given that the euro's movements are also tied to global oil prices, analysts note that recent oil prices have declined, trading at 64.86, which is 3.1% below the three-month average. This dip in oil prices could also have implications for the euro's strength against the TWD and other currencies.

Looking ahead, the trajectory of the EUR to TWD exchange rate will be influenced by a combination of ECB monetary policy, economic indicators from the Eurozone, and broader geopolitical developments affecting the Taiwanese dollar. Investors should remain vigilant of these dynamics as they navigate the complexities of the currency market.