Euro Forecast: Concerns Linger Over Italian Budget, Rising Hard Brexit Odds

Euro Forecast: Concerns Linger Over Italian Budget, Rising Hard Brexit Odds

Fundamental Forecast for EUR/USD: Neutral

Euro gains over the past week have largely driven by signs that the Italian government will fall in line with the European Union’s budgetary restraints.

– A surprising amount of negativity at the Brexit Salzburg summit this week knocked the British Pound lower, and dragged the Euro down alongside with it.

– The IG Client Sentiment Indexhas been upgraded to ‘bullish’ for the Euro as retail traders continue to buy the US Dollar on dips.

See our long-term forecasts for the Euro and other major currencies with the DailyFX Trading Guides.

The Euro was a top three performing major currency last week, only losing ground to the resurgent Australian and New Zealand Dollars, thanks to buoyed risk appetite around the globe. EUR/JPY led the way higher among the EUR-crosses, gaining +1.52%, while EUR/USD added +1.06% and EUR/GBP gained +1.03%. Amid a quiet economic calendar, the major catalyst for Euro gains was news that the Italian government wouldn’t run a budget deficit above 1.6% of its GDP, the threshold that European Commission officials have

Article source: https://www.dailyfx.com/forex/fundamental/forecast/weekly/eur/2018/09/23/Euro-Forecast-Concerns-Linger-Over-Italian-Budget-Rising-Hard-Brexit-Odds.html