GS say that with the ECB meeting in the rear-view mirror the EUR is in a good position to benefit from further USD weakness.

ECB expressed limited concern about recent euro appreciation (as expected)

  • EUR is still undervalued
  • longer-term fair value for EUR/USD is around 1.30
  • euro is still "under-owned" by global investors
  • EZ domestic markets should benefit from broad global recovery

GS 12 month horizon target for EUR/USD is 1.25.

  • a win for Joe Biden, vaccine approval by year-end could see the pair hitting that sooner than forecast
GS say that with the ECB meeting in the rear-view mirror the EUR is in a good position to benefit from further USD weakness.