EUR/USD to climb back towards 1.10 by the end of March – SocGen

EUR/USD is hanging in around 1.06. Economists at Société Générale expect the pair to move back higher toward 1.10 by the end of March. 

Yield differentials are wind in the Euro’s sails

“We argued that a bit of risk aversion and wider credit spreads could take EUR/USD to 1.06 (and GBP/USD below 1.2). Both went marginally further, and we could still see some wobbles in the days ahead but yield differentials should start to matter again and I expect we’ll be climbing back towards EUR/USD 1.10 by the end of March.”

“As for Sterling, everything now depends on DUP support for the Windsor Framework. Some negotiation may be required, but if support is forthcoming, we might see EUR/GBP get back below 0.86.”