Barclays Predicts EUR/USD to Decline Toward 1.06 Amid Trade Risks
Barclays maintains a bullish outlook on the US dollar, despite growing economic uncertainties linked to President Trump's second term. The bank highlighted potential headwinds, including the impact of trade policies and a potentially tighter fiscal approach, which could weigh on the US economy.
While Europe's fiscal response particularly Germany’s measures has helped stabilize the euro, Barclays believes it may not be enough to drive a breakout from the EUR/USD’s two-year trading range of 1.02 to 1.09. With the currency pair currently hovering around 1.10, analysts suggest that the market has already priced in the benefits of fiscal expansion, whereas the risks of new US tariffs remain only partially factored in.
Barclays projects that as trade concerns escalate, the euro will face renewed pressure, pushing EUR/USD toward the 1.06 level in the near term.
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