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Euro gains against dollar as softer US jobs lower Fed hike odds

Rabobank expects EUR/USD to move to 1.16 in three months, driven mainly by reduced expectations for additional Fed rate hikes.

Reported · Written up by our desk · Major Pairs

Rabobank said recent strength in EUR/USD is being driven largely by a softer US dollar after weak US labour data reduced expectations for further Federal Reserve rate hikes, FXStreet reported.

According to Rabobank senior FX strategist Jane Foley, the move higher came after a surprisingly soft US July labour market report, which knocked US yields lower and pushed the greenback down.

Foley added that, while Eurozone data has remained resilient, growth headwinds and a limited appetite for a strong Euro mean the currency pair is unlikely to see much additional upside from rate expectations alone.

Rabobank now forecasts EUR/USD will reach 1.16 over the next three months, having brought forward its previous timeline for that level from six months to three.

Latest closeEUR/USD 1.152 ▼0.3%

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