Euro to Dollar Forecast: EUR Uptrend in Tact, 1.15 Resistance

April 27, 2025 - Written by Frank Davies

STORY LINK Euro to Dollar Forecast: EUR Uptrend in Tact, 1.15 Resistance

Currency forecasters at MUFG expect the Euro to Dollar exchange rate (EUR/USD) to strengthen to 1.20 by the end of 2025 and extend gains over the following two years.

Credit Agricole is less convinced that the Euro can hold gains and forecasts a EUR/USD retreat to 1.12 by the end of 2025.

The underlying tone was consolidation during the week with EUR/USD little changed around 1.1370 after failing to sustain a surge to 3-year highs above 1.1550.

MUFG considers that the dollar will continue to correct the long-term over-valuation.

It considers that the tariff policies will damage the dollar; “Firstly, damage to some degree is already done. By announcing tariffs of such a scale, investors will remain cautious over what could come next. Secondly, we expected a cyclical slowdown to take place anyway in the US and Trump’s actions only reinforce that prospect and a policy reversal now won’t change that.”

The bank also considers that other global factors are in play including the EU fiscal boost and Japan’s move away from extreme monetary easing. It added; “There are key international factors that drove the dollar to overvalued levels and those factors should now help bring dollar valuation back down.”

ING commented on the short-term view; “As to the dollar more broadly, it could find a little support as trade tensions calm a little.”


As well as trade developments, US data over the next week will be watched very closely.

According to ING; “The next big chapter here will be whether all this volatility has hit real world decisions - especially in the US jobs market. There is plenty of US jobs data released next week and any deterioration here could trigger another round of dollar losses - albeit a more benign dollar decline on the view that the Federal Reserve would be riding to the rescue after all.”

Deutsche Bank added; “Investors have been reluctant to fully price in a recession because we don't have enough evidence that one is likely. But if that changes and we start to see contractionary numbers (e.g. a negative payrolls print), that would lead to a fresh reassessment that could open the way for a fresh selloff.”

Firm data would at least postpone the day of reckoning for the currency.

Importantly, Danske considers that there has been important damage to the dollar.

The bank now has a radically different 12-month EUR/USD forecast of 1.22 from 1.00 two month ago.

According to the bank; “Longer term, we believe the evolving structural backdrop — including the seismic shift in US politics, the ongoing trade war, and signs of capital rotation out of US assets — will leave the USD facing the greatest relative downside.”


Danske added; “We estimate EUR/USD fair value over a 1–3-year horizon to be around 1.20. Key factors to watch include potential structural capital rotation out of US assets, the evolving global energy landscape, and euro area fiscal policy — all of which could influence EUR/USD valuation dynamics over time.”

In this context, the Ukraine situation will be watched closely and any ceasefire deal could underpin the Euro.

Credit Agricole expects the ECB will have to be even more dovish; “the ECB may view the sharp EUR NEER appreciation since the start of 2025 as adding to the downside risks to the Eurozone growth and inflation outlook.”

Further Euro gains would also create even more pressure for an ECB pivot.

The bank added; “In all, we continue to think that EUR/USD is looking overbought and overvalued at current levels and believe that the pair should remain sell on rallies in the very near term.”

UBS commented; “As the US announces new trade agreements, we anticipate confidence in the USD to be gradually restored. Accordingly, after the sharp EURUSD rally from 1.02 to 1.14, we think a period of consolidation is more likely than a continued surge.”

It added; “We expect EURUSD to trade in a 1.12–1.16 range in the coming months, with a bias toward the lower end as trade deals are signed.”

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TAGS: Currency Predictions Euro Dollar Forecasts