Euro to Dollar Forecast: EUR/USD "Range Between 1.1600-1.1720"

Modified: Thursday, 21 August 2025 08:15 BST - Written by Tim Boyer

STORY LINK Euro to Dollar Forecast: EUR/USD "Range Between 1.1600-1.1720"

The Euro to Dollar exchange rate (EUR/USD) found support near 1.1620 early on Wednesday and edged higher to just above1.1660 at the US open.

The dollar dipped lower after President Trump called for Fed Governor Cook to resign, triggering another round of concerns that the Administration will look to gain control of the central bank to pursue the campaign of lower interest rates.

Overall ranges were still relatively narrow.

According to UoB, EUR/USD needs to take out 1.1700 to ease downward pressure

Scotiabank maintains a positive overall euro stance; “the multi-month trend remains bullish with a clear sequence of higher highs and higher lows since February.”

On a short-term view, it added; “we look to a near-term range bound between 1.1600 and 1.1720.”

The main event should be Friday’s speech by Fed Chair Powell, although strong pressure for Cook’s resignation could overshadow Powell and undermine the dollar.


Morgan Stanley commented; “If Chair Powell is fine with cutting in September and has made that decision more or less in his mind, then we think he simply has to avoid saying anything about the near-term course of monetary policy. In doing so, it would make it nearly impossible for the Fed not to deliver a cut in September.”

The bank, however, expects a more balanced stance; “We come down on the side of thinking the Fed would prefer to retain optionality and, if anything, we look for Powell's remarks at Jackson Hole to be similar to the message from July.”

Markets are pricing in over an 80% chance of a September cut and any shift in expectations would support the dollar.

According to Commerzbank's FX analyst Antje Praefcke; “it could be that the market has gone a little too far with its expectation of almost three interest rate cuts by the end of the year. If Powell fuels doubts about these expectations on Friday, EUR/USD could fall back towards 1.15."

She is still cautious over the underlying dollar outlook and the bias is still for gains to be limited and temporary.

Praefcke added; “As we have often written, many factors, including structural ones, are currently weighing on the greenback. It is easier to jump on the 'weaker dollar' bandwagon when there are convenient arguments than to buy it on the basis of a cautious statement by Powell. In short, it is harder for the dollar to go up than down."

Credit Agricole remains positive on the US currency; “Looking ahead, we believe that still considerable FX hedging costs and the recent consolidation of the USD across the board could discourage foreign investors from hedging their USD exposure too aggressively.”


It added; “We therefore continue to see returning (unhedged) foreign inflows into the US stock markets as a key positive to our long-term USD outlook.”

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TAGS: Euro Dollar Forecasts