Goldman Sachs targets EUR/USD at 0.94 in 3 months

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Goldman Sachs Research discusses EUR/USD outlook and targets the pair at 0.94 in 3 months and 0.97 in 6-months.

"The Euro is deeply undervalued by most conventional standards, but we see good reason to be skeptical about those valuation estimates at this time. The Euro area's current account has deteriorated significantly in recent months, and it could swing lower by more than EUR500bn for the year as a whole . Higher prices for scarce energy have driven most of this decline, and we think that could have a material impact on prospective returns for the Euro," GS notes.

"As a result, our model estimates of EUR EUR The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value Read this Term fair value have already moved lower this year, and would fall substantially further (close to current spot levels) if the current account remains around current levels," GS adds.