Yushin Bank: Divergence in U.S. and European central bank policies may push EUR/USD above 1.20

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ME News, April 27 (UTC+8): A strategist at the Investment Research Institute of United Overseas Bank said that if the European Central Bank raises rates later this year while the Federal Reserve cuts rates, EUR/USD could rebound to above 1.20. In their report, they noted that on Thursday the European Central Bank is likely to hold rates steady to wait for more information on how the Iran war will affect inflation. However, they said the European Central Bank may raise rates in June and September. By contrast, the Federal Reserve may cut rates in December. A narrowing yield spread could push EUR/USD to this year’s highest level so far at 1.2078, even though “this needs to wait until the risk premium caused by the current war has fully dissipated.” (Source: Jin10)
EURUSD-0.06%
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