Euro to Dollar Price Forecast: Steady Around 1.15, Momentum Holding

June 20, 2025 - Written by Tim Boyer

STORY LINK Euro to Dollar Price Forecast: Steady Around 1.15, Momentum Holding

The US Dollar has posted gains over the 24 hours with the Euro to Dollar exchange rate (EUR/USD) dipping to just below 1.1450 before settling around 1.1475.

The Federal Reserve decision and capital account data did not undermine the dollar, and the US currency gained net support from geopolitical concerns.

Fears over US involvement will make traders more cautious in selling dollars.

ING commented; “Our near-term target is 1.140, and explorations below that level can be justified even without new big spikes in oil prices.”

A spike in oil prices could trigger further losses

UoB is more cautious on the scope for EUR/USD losses; “we expect EUR to edge lower, and potentially test the 1.1440 support level. The major support at 1.1400 is not expected to come into view. Resistance is at 1.1500, followed by 1.1525.”

The dollar has secured net support from geo-political concerns amid the on-going Israel/Iran conflict with oil prices close to 4-month highs.


The US Administration is continuing to debate whether to attack Iranian nuclear targets with underground-busting bombs.

There have been several reports that an attack is possible during the weekend, but Trump is being deliberately evasive.

City Index senior analyst Matt Simpson commented; "The dollar seems ripe for a short-covering rally - especially if the U.S. wades into the Middle East conflict."

ING added; “the combination of geopolitical risks and high oil prices is not US-induced risks, and therefore the dollar is still in a more favourable spot than the energy-dependent safe-haven alternatives (like the euro) in this environment.”

The Federal Reserve held interest rates at 4.50%, in line with strong consensus forecasts.

Fed Chair Powell reiterated that the Fed is in a good place and that the central bank will be in a better place to act if it waits for a couple of months.

Powell considered that tariff threats had eased somewhat, but he was still uneasy over potential inflation trends even though he welcomed favourable readings for the last three months.


According to Danske Bank; “We maintain our Fed call unchanged and still see 25bp rate cuts in September and December this year, followed by three more reductions in 2026.”

Nordea is much more cautious on the potential for rate cuts; “the Fed sticking to its “wait and see” approach, allowing time to assess the full impact of new tariffs on both inflation and economic activity. Notably, inflation expectations have already risen. We expect the Fed to hold rates steady the next two years; however, the balance of risks to this forecast leans to the downside.”

There was a downgrading of growth forecasts with inflation projections slightly higher.

MUFG commented; “The unfavourable mix of weaker growth and higher inflation in the US remains a headwind for the US dollar and should help to dampen further US dollar upside on the back of the Fed’s reluctance to resume rate cuts in the near-term.”

The latest capital account data recorded only a modest decline in US bond holdings by overseas funds and central banks.

ING considered that the data did not suggest sharp capital outflows.

It added; “Anecdotal evidence in de-dollarisation remains significant, and at least another month of TIC data is needed to get a clearer picture. However, the dollar likely dodged a bullet with yesterday’s figures, and the lack of conclusive evidence of foreigners' exodus from Treasuries can make markets slightly more cautious in building additional risk premium on the dollar.”

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TAGS: Euro Dollar Forecasts