ING’s Oct. 12 outlook put EUR/USD at $1.13 at one, three and six months, tying the closely watched exchange rate to Federal Reserve policy and French budget strain.
The Federal Reserve raised its target range by 25 basis points to 3.75% to 4% on Sept. 16. Minutes from the meeting showed most participants viewed another increase before year-end as probable if incoming economic information supported it.
France's Ministry of Economy said the 2027 draft finance bill was filed with the National Assembly on Oct. 1. ING identified French budget unrest as a risk for the euro and compared French government debt concerns with Italy's 2018 debt crisis, which it characterized as election-driven.
ING's table listed a spot rate of 1.1203, forecasts of $1.13 at one, three and six months, and $1.16 at 12 months. The shorter-horizon forecast is unchanged across those periods, while the 12-month figure is higher. The bank said EUR/USD could stay pressured near the lower end of a $1.10 to $1.15 range over the next three to six months, citing the Fed outlook, France's budget and U.S. yields.
FXStreet reported Oct. 22 that weakness in U.S. technology shares could prompt a broader dollar correction if investors unwound concentrated tech and dollar positions and markets priced a less hawkish Fed. The outlet said a break above 1.1270 to 1.1275 could open a move to 1.1340 to 1.1350, and reported a one-month forecast of 1.13, matching ING's published table. FXStreet presented the higher levels as a conditional technical scenario.
The Fed's next scheduled meeting is Tuesday and Wednesday, Oct. 27-28.
