Published research this week leans bullish on EUR/USD over the medium and long term, though one tactical dissent flags near-term downside.
The prevailing view among researchers points to steady euro appreciation, with published targets clustering around 1.16 by late 2026 and reaching 1.20–1.21 by 2027–2028. The case rests on narrowing US–euro rate differentials, ongoing diversification away from the dollar, and sticky price pressures inside the euro area. A separate strand of analysis argues that softer US inflation data and cooling Fed rate-cut pushback, combined with a more hawkish tone from the ECB heading into its next meeting, have already nudged short-end yield spreads in the euro's favor. One contrarian framing describes a higher EUR/USD as the "pain trade," reinforced if Asian currencies also strengthen against the dollar.
The outlier: a tactical call for EUR/USD to dip below 1.14 toward 1.1380 this week, citing a tighter two-year swap spread and elevated energy prices. Different horizons — not a real disagreement.