EUR/USD Heading ‘Erratically’ Towards 1.20, and EUR/JPY to 130 – SocGen

The euro is on an uptrend[1] against the dollar and even more against the yen. The team at SocGen see even further gains.

Here is their view, courtesy of eFXnews:

Societe Generale FX Strategy Research argues that the ECB isn’t going to hike rates soon, but how fast they move to reduce the pace of bond purchases probably does depend on how much the euro rallies.

“But the turn in the economy is pretty plain for us all to see. This week it has been the IFO survey and money supply data that show a continued acceleration in underlying loan growth. So, of course, the lifespan of extraordinarily easy policy settings (particularly asset purchases) is shortening.

The ECB can’t normalise monetary policy without sacrificing the extreme cheapness of the currency, but maybe the ECB President thinks he can avoid a disorderly currency correction if he manages to guide market expectations,” SocGen argues.

From here, we still think we’re a heading, erratically, towards EUR/USD 1.20 and above EUR/JPY 130,” SocGen projects.

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from Forex Crunch http://feedproxy.google.com/~r/ForexCrunch/~3/4yyfkw05uPI/

from Online Forex Trading Resource
View thesource article here

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