Citi Says EUR/USD Could Hit 0.86 By Investing.com

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Citi Says EUR/USD Could Hit 0.86

Currencies Oct 13, 2022 07:42AM ET

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By Senad Karaahmetovic

The persistently strong U.S. dollar continues to create headwinds for businesses that have high international exposure. The EUR/USD has settled below parity for a few weeks now with analysts expecting the pair to test new 20-year lows soon amid rising rate yields.

Citi strategists argue that the U.S. dollar “has likely not peaked yet.” Citi sees EUR/USD falling to 0.93, although their FX strategists argue that the major could eventually hit 0.86 if macro headwinds increase.

On how the continued strength of the greenback will impact broader markets, the strategists wrote:

“A strong USD is a negative for US assets across the board. While the impact of the USD on the US economy should be manageable, asset prices will likely react. We expect the USD basis to widen, which is negatively correlated with risky assets. Earnings of US equities are likely pressured lower by a strong USD.”

As far as the Japanese yen is concerned, they see the potential for a BoJ reaction if the USD/JPY continues to make new highs.

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Comments (2)

Ram Thakilpatty Oct 16, 2022 11:00PM ET

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Good let it drop as musch as it can

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Randall Paul Oct 13, 2022 7:48AM ET

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i predict for now 0.93

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US 30	33,715.4	-1.7	-0.01%
US 500	4,019.6	+1.8	+0.05%
Dow Jones	33,717.09	-260.99	-0.77%
S&P 500	4,017.77	-52.79	-1.30%
Nasdaq	11,393.81	-227.90	-1.96%
S&P 500 VIX	19.94	+1.43	+7.73%
Dollar Index	102.035	-0.051	-0.05%

Crude Oil WTI	77.69	-0.21	-0.27%
Brent Oil	84.31	-0.19	-0.22%
Natural Gas	2.678	-0.006	-0.22%
Gold	1,923.10	+0.20	+0.01%
Silver	23.718	-0.015	-0.06%
Copper	4.1760	-0.0080	-0.19%
US Soybeans	1,533.50	0.00	0.00%

U.S. 10Y	3.540	-0.011	-0.30%
U.S. 30Y	3.655	-0.005	-0.13%
U.S. 5Y	3.6621	-0.0210	-0.57%
U.S. 3M	4.7096	+0.0490	+1.04%
US 10Y T-Note	114.38	+0.09	+0.08%
Euro Bund	136.62	-0.01	-0.01%
10-2 Yield Spread	-69.58	-1.09	1.59%

Apple	143.00	-2.93	-2.01%
Alphabet A	96.94	-2.43	-2.45%
Tesla	166.66	-11.24	-6.32%
Amazon.com	100.55	-1.69	-1.65%
Netflix	353.11	-7.66	-2.12%
Meta Platforms	147.06	-4.68	-3.08%
Bank of America	35.30	-0.15	-0.42%

Citi Says EUR/USD Could Hit 0.86

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