Most published research leans bullish on the euro against the dollar — but the consensus isn't unanimous.
The bull case, as several recent research notes frame it, is that dollar strength is overextended and largely priced in. One view argues the market got too feverish on hawkish Fed pricing and is due a tactical reset. Another observes the dollar has already peaked and rolled over, with EUR/USD bouncing from around 1.1325 toward 1.14. A separate analysis sees the pair stabilizing above 1.13 and recovering above 1.15 this summer. Longer-horizon forecasts from another research thread project a climb from roughly 1.05 in early 2025 toward 1.16–1.18 by late 2025 and into 2026–27, assuming the Fed holds and growth outside the US improves alongside softer energy prices.
The contrarian camp targets a move toward 1.10, pointing to eurozone contraction signals, historical euro weakness ahead of Fed tightening, and sticky US labor and inflation data. A related downside scenario flags sub-1.10 if the Fed delivers multiple further hikes — framed as a risk case, not a baseline.
The core disagreement: how much Fed hawkishness is already in the price.