UBS has issued a forecast for the EUR/USD currency pair, predicting a gradual rise above 1.10 and targeting 1.16 by the end of 2025.

US Dollar Resilience

The US dollar has shown resilience after experiencing weakness in August and September, making a notable comeback in October. This resurgence was driven by stronger-than-expected US jobs data and robust PMI figures.

European Central Bank's Response

In contrast, the European Central Bank (ECB) has responded to disappointing inflation figures by cutting interest rates.

Upcoming US Labor Market Reports

UBS anticipates that the upcoming US labor market reports will play a crucial role in shaping the Federal Reserve's future actions.

Chaotic Ride in the Near Term

UBS's analysis indicates that the currency pair is likely to experience a chaotic ride in the near term, with the US election injecting additional volatility into the market.

Positive Outlook for Europe

UBS maintains a positive outlook for Europe, anticipating a resumption of economic growth as the region approaches 2025.

Monitoring Economic Indicators

UBS advises investors to monitor economic indicators closely and remain vigilant, as shifts in economic conditions could lead to rapid changes in the exchange rate.

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