In 2021 the Euro has mostly dropped versus the greenback, except for Q2, mainly due to the expectation of inflation and an increase in US interest rates. This has pushed up the USD exchange rate against most currencies.
In addition should risk sentiment remain fragile, there could be continued demand for USD as a safe haven. Therefore, USD/EUR could gain higher.
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Other optimistic forecasters, believe the ECB’s support of the eurozone economy is working, they suggest a strong upside for the euro against the U.S. dollar this year and that EUR/USD will test new highs in 2021.
Dollar strength and German political uncertainty sees the Eurozone single currency on the decline and at 1 YEAR LOWS versus the greenback touching the 1.15 level vs the greenback.
There will be a close eye kept on Eurozone inflation data on October 29, any upside surprise could support the euro.EUR Outlook
The USD had a strong month in September, outperforming all the G10 currencies. The gains can be attributed to more ‘hawkish’ commentary from the US Federal Reserve, especially in comparison to the European Central Bank.
According to OFX the USD trend for October is unclear.USD Outlook
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