EUR/USD: Further signs of dysfunction in Europe could weigh heavily on the euro – Rabobank

Given the USD’s safe-haven appeal economists at Rabobank see scope for a move towards EUR/USD 1.05 on a 3-month view.

Key quotes

“Lengthening unemployment queues and the disagreements about debt pooling threaten to increase the pressure in the region.”

“Renewed signs of tension between the US and China may be a drag on the EUR due to the impact on Germany’s trading channel.”

“Set against a backdrop of solid demand for the USD, we see scope for a dip in EUR/USD towards 1.05 on a 3-month view.”