Experts say Euro US Dollar rate can see 1.20 by the end of the year

The dollar lost about 1 percent during the past week, while the euro rose by about 1.8 percent. According to analysts, the euro could see 1.20 levels against the dollar in the last quarter of the year.

While the US dollar goes down to its lowest level in the last 13 months, the euro displays an upwards trend. The euro-dollar parity rose to 1.1655, a peak in the last two years, when Mario Draghi, the President of the European Central Bank announced on Thursday that the Euro Zone was “unquestionably” improving and the bank planned to reduce its financial expansion program (QE) in autumn. As analysts believe the upward momentum will continue in the euro, the euro / dollar rate closed at 1.1663, on Friday.

Experts also comment that the euro / dollar pair is moving towards equilibrium. The parity has been depreciating for a very long time and this normalization, which will come from the ECB now on the market, has begun to be priced.

President Draghi, who held a press conference after the ECB’s July monetary policy meeting on Thursday did not say exactly what date the monetary tightening would begin. Analysts, however, predict that the bank may be able to explain its plans to reduce its asset recovery program in September.

Euro / US Dollar rate can see 1.20 by the end of the year

Investors believe the ECB QE program will reach 40 billion euros a month in the fourth quarter of 2017. In this period, the outstanding deposit interests will be gone.

Many experts believe QE will end up in 2018 which is supposed to mean a positive sign for the euro. The euro has been following a fluctuating trend since the 1.0404 lowest levels seen in January against the dollar. But in recent days it has caught a rising momentum against the dollar exposed to some negativities in US politics.

Washington has caught the bullish momentum against the dollar, which is exposed to cracking voices in politics. As to the question “How much can the euro rise against the dollar?” experts forecast predicts that euro could likely reach $ 1.20 by the end of the year before rising to $ 1.25 in 2018.

MEDIA