A quick snippet via BNP on their outlook for the second half of the year
Expect the euro to strengthen versus the dollar
- USD is expensive on valuation grounds
- the Fed will ease
Thus see EUR/USD at:
1.16 for Q3
1.20 for Q4
More:
Expect the Fed to cut rates twice in H2 due to
- a slowing economy
- subdued inflation
- heightened uncertainty
A decline in the 10-year treasury yield will only be moderate with markets pricing in rate cuts
On the ECB, BNP expect rates to remain unchanged through 2020, but:
- slower growth
- subdued core inflation