JP Morgan's EUR/USD forecast profile is unchanged this month and continues to show a slower decline for the rest of the year, after an unprecedented -11% drop in Q1. JPM's Quarter-end targets are 1.07 in Q2, 1.06 in Q3 and 1.05 in Q4.

'Downside targets would be more aggressive were it not for the US dollar’s valuation problem and the Fed’s gradual pushback on a strong currency.'

JP Morgan Forecasts. Buy Euro as Market is Only Now Waking up to Brexit Risks say JP Morgan: Australian Dollar Forecasts Cut at J.P. Morgan; Potential 5% Upside for GBP/AUD.

2015 Jp Morgan Holiday Reading List

'Based on JPM’s expectations that the ECB balance sheet expands to €3.5trn by end 2016 and that 5-yr spreads might move about 50bp in the US’s favour, EUR/USD’s fair value is about 1.12 (blue cell in table 1). The euro's current level near 1.06 would be justified if the ECB balance sheet were heading to €5trn (unlikely given how Euro area growth is improving) or the USEuro 5-yr spread would widen to over 300bp over the cycle (unlikely as the Fed dots fall towards the money market curve due to mediocre US growth)'.

'So while we know that currencies can undershoot for some time until a macroeconomic or policy catalyst emerges, we are reluctant to forecast trend extensions that have little empirical basis'.

2015 Jp Morgan Chase Catalog

The upside risk to this view, according to JPM, could probably take EUR/USD towards 1.15 over the coming months if one or more of these 2 scenarios materialize:

• US economy slows to below trend or fails to generate any wage or inflation pressure, causing the Fed to delay tightening until 2016; (2) Euro area growth accelerates to 3% at some point in 2015, forcing a sharp repricing of money market rates and attracting significant foreign equity inflows. In the mean time, the downside risk to this view, according to JPM, could probably take EUR/USD below 1.00 if one or more of these 3 scenarios materialize:
• the Fed signals commitment to June hikes (not priced); (2) the Greek government decides to exit EMU; or (3) the SNB begins selling euros for dollars now as part of its FX regime change.

JPM also lists the following as potential trigger events:

- ECB meetings on Apr 15, Jun 3, Jul 16 and Sept 3 - ECB TLTROs in Jun, Sept and Dec 2015 - Euro flash HICP reports Apr 30, May 2, June 2, June 30, Jul 31 and Aug 31 - FOMC on Apr 29, Jun 17, Jul 29 and Sept 17, Oct 28 and Dec 16.

Pound Sterling to Euro, US Dollar Trend Higher after BoE Minutes

rnrn

The Pound fell back to 1.41 against the Euro and 1.55 against the US Dollar on Thursday as the UK's retail sales report fell short of forecasts. Today's UK loans for home purchase figures could affect Pound movement before the weekend.

Earlier...

Both the GBP/EUR and GBP/USD exchange rates were able to advance following the publication of minutes from the latest Bank of England (BoE) meeting on Wednesday. The minutes revealed that the Monetary Policy Committee (MPC) was of one mind about leaving borrowing costs on hold and that the decision was clear cut for all members. However, it was also noted that the situation in Greece had had a big impact on the decision making process. With the odds of a Grexit taking place now considerably smaller than they were, investors now believe that policymakers are likely to push for higher borrowing costs at next month’s gathering. This speculation drove the Pound higher across the board. rnrnA quick foreign exchange market summary before we bring you the rest of the report:rnrnOn Friday the Euro to British Pound exchange rate (EUR/GBP) converts at 0.897

Today finds the pound to euro spot exchange rate priced at 1.115.

FX markets see the pound vs new zealand dollar exchange rate converting at 2.042.

The pound conversion rate (against us dollar) is quoted at 1.235 USD/GBP.

NB: the forex rates mentioned above, revised as of 13th Mar 2020, are inter-bank prices that will require a margin from your bank. Foreign exchange brokers can save up to 5% on international payments in comparison to the banks.rnrn

FX Outlook Now: Retail Sales Flop Triggers GBP to EUR, USD, NZD Exchange Rate Losses

rnrnHowever, Sterling’s uptrend didn’t last for long and the British currency quickly fell against both the Euro (GBP/EUR) and US Dollar (GBP/USD) following the publication of the UK’s retail sales report. The -0.2% drop in sales, month-on-month, disappointed hopes for a 0.4% gain and took the annual figure lower. Consumer spending fell in spite of soft inflation and declining average store prices and the Pound subsequently declined against peers like the Australian and New Zealand Dollars.rn

James Knightly of ING bank observed; ‘UK retail sales for June are surprisingly soft. Overall, it isn’t great news, but we feel that the trend for consumer spending remains strong. Indeed, retail sales are still growing 4% year-on-year and with consumer confidence at 15 year highs, real wages rising by around 3% year-on-year and employment continuing to move higher, the outlook remains positive for spending. We still look for a February Bank of England Rate Hike.’

rnrnForeign Exchange Newsflash: GBP/USD Exchange Rate Drops to 1.5582 Today rnrn

Industry Expert Exchange Rate Forecasts: JP Morgan Analysts See GBP to USD Conversion Rate Trending in Narrow Range

rnrn‘Cable’ is currently trending on the cusp of 1.56 but analysts with JP Morgan have presented the following forecast for the pairing; rnrn

’A failure to clear the upper barrier would leave the H & S topping pattern intact, which implies that the market is at least missing a stronger C-wave down into 1.4951/1.4887 (pivot/76.4 % on higher scale). Above 1.5815 though, we'd see 1.6052 (pivot) back in focus whereas a break below 1.5390 would hand over full control to the bears.’

rnrnFX Rates Now: GBP/EUR Trending at 1.4206 Todayrnrn

Eurozone Consumer Confidence Data Could Impact GBP/EUR Exchange Rate Trading

rnrnThe GBP to EUR currency pair has moved from a high of 1.4304 to a low of 1.4173 today as investors responded to calming German concerns and the UK’s sub-par retail sales report. However, the Pound may be able to move away from the day’s low if the Eurozone’s Consumer Confidence index reveals the slide in sentiment anticipated by economists. The measure is forecast to fall to -5.8 from -5.6.rnrn

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