StanChart sees weaker U.S. dollar, raises EUR/USD forecast to 1.16

April 28, 2025 09:51 PM AEST | By Investing

Google News:

StanChart sees weaker U.S. dollar, raises EUR/USD forecast to 1.16

Recent News

World Digital Introduces Innovative E‑Commerce Strategies Amid Global...

Alex Miller Keeps Classic Country Flame Burning With Alan Jackson Song...

Trump earns over $600 million from crypto, holds assets worth at least...

Oil in biggest gain since 2022 as Israel hits Iran, but Citi warns gai...

Investing.com -- Standard Chartered (LON:STAN) (StanChart) revised its forecast for the US dollar, anticipating a weaker performance than previously expected.

The Asia-focused bank now projects that the EUR/USD exchange rate will reach 1.16 by the end of the second quarter of 2025, up from its earlier forecast of 1.06, and will maintain that level through the end of 2025, an increase from the prior estimate of 1.04.

According to StanChart, this revision reflects a broader trend of dollar weakness against other G10 currencies. The bank also indicated a moderate "risk-on" bias for G10 currencies, suggesting that higher-beta currencies might outperform safe havens in the upcoming months.

StanChart’s baseline expectation is that the dollar will be slightly weaker compared to its current spot but will remain essentially stable through the end of the year. Despite recent positive developments from the U.S. administration regarding tariffs and encouraging equity market gains, the dollar has not shown significant strength.

This leads the bank to believe that the adjustment in dollar positions is ongoing and could result in a further decline in the dollar’s value.

The bank also acknowledges uncertainty surrounding its baseline forecast. It notes that President Trump has an incentive to maintain a stable policy environment as the new fiscal package becomes a focal point. Trump may aim for quick tariff deals to support the argument that tariff revenues will positively contribute to the projected revenues in the upcoming fiscal bill.

Economic advisors are likely cautioning that adding a risk premium to U.S. assets could be detrimental without offering any benefits.

StanChart suggests that if the unwinding of aggressive policy takes precedence, the dollar could see an appreciation beyond the bank’s current baseline projections.

This article first appeared in Investing.com

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (“Kalkine Media, we or us”), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary.
The content published on Kalkine Media also includes feeds sourced from third-party providers. Kalkine does not assert any ownership rights over the content provided by these third-party sources. The inclusion of such feeds on the Website is for informational purposes only. Kalkine does not guarantee the accuracy, completeness, or reliability of the content obtained from third-party feeds. Furthermore, Kalkine Media shall not be held liable for any errors, omissions, or inaccuracies in the content obtained from third-party feeds, nor for any damages or losses arising from the use of such content.
Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyrighted to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have made reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.
This disclaimer is subject to change without notice. Users are advised to review this disclaimer periodically for any updates or modifications.