Package Juckes, Chief Global FX Strategist at Société Générale, analyzes EUR/USD and USD/JPY outlooks on three scenarios
Uk news Hard, gentle, or no landing at all?
The base case assumption, which assumes a tranquil US recession in the heart of next year, appears to be like for 10-year Treasury yields to fall to a few.7% by the heart of next year.
USD/JPY could be just below 150 in mid-2024 on a US no landing, below 130 on a hard landing and just below 140 on our base case.
Our rates forecasts indicate EUR/USD reaching 1.15 by mid-2024 on our base case for the economic outlook (tranquil recession), and 1.02 on the ‘no-recession’ forecast. A hard landing clouds the outlook because the initial reaction is for the relationship between EUR/USD and interest rates to break down, temporarily.
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