EUR/USD to 1.20 by year-end 2026: the dollar-overvaluation case
EUR/USD near 1.167 is capped by a firm dollar, but the base case sees 1.20 by year-end as the Fed converges toward a neutral ECB. Bull 1.25, bear 1.13.
Desk
Market calls with a spot, a target and an invalidation level.
257 stories since 2018 · page 7 of 13
June 2026
EUR/USD near 1.167 is capped by a firm dollar, but the base case sees 1.20 by year-end as the Fed converges toward a neutral ECB. Bull 1.25, bear 1.13.
The S&P 500 fell 2.6% to 7,383.74 after a hot jobs print. Base case 7,000 by Q3 as the Fed-cut path reprices toward zero. Bull 7,800, bear 6,600.
USD/JPY sits at 159, overbought, as the BOJ hikes toward 1.0% and the Fed holds. Base case 153 by Q3 2026, bull 164, bear 147 on a carry unwind.
NZD/USD targets 0.62 by Q3 2026 as the RBNZ signals hikes while the Fed is priced to cut — a rare central-bank divergence reshaping the kiwi.
USD/CHF targets 0.76 by Q3 2026 as the Fed-SNB rate gap closes and safe-haven demand lifts the franc, with SNB intervention the main risk to the call.
Gold sits near $4,600 after a sharp 2026 correction. Why $5,000 by Q3 is the base case — central-bank demand vs real yields, with four invalidation triggers.
WTI crude targets $72 by Q3 2026 as the US-Iran ceasefire reopens the Strait of Hormuz and OPEC+ unwinds cuts into a 2.3m bpd surplus. Base, bull, bear cases.
May 2026
Platinum near $1,950/oz targets $2,300 by Q3 2026 on a fourth straight WPIC deficit and four-month-low stocks — plus the signals that would break the call.
The US 10-year Treasury yield, at 4.44% after a 4.70% May high, eases to a base-case 4.10% by the September FOMC as the Iran-war inflation premium unwinds.
AUD/USD to 0.73 by year-end 2026 (bull 0.76, bear 0.68): the RBA holds at 4.35% while the Fed eases, with firmer terms of trade - gated by China demand.
USD/CAD targets 1.3200 by Q4 2026 as Fed cuts compress the 112bp 2Y yield gap while BoC stays at 2.50% and Brent crude holds the $75 floor.
DXY to 96 by Q3 2026: fractured 8-4 FOMC, GSDEER 15% overvaluation, Iran de-escalation. Spot 99.24 May 26. Invalidation: weekly close above 101.50.
Base case GBP/USD 1.3000 by Dec 31 2026 on a 75bp BOE cut path against a Fed that holds; bull 1.4000, bear 1.2500. Four signals that break the call.
COMEX copper to $7.00/lb by Dec 31, 2026 base case: JPM's 330k-tonne deficit, COMEX tariff arbitrage stocks above 503k tonnes, and a grid-and-AI demand pulse.
S&P 500 targets 7,800 by year-end 2026 from 7,473 on AI capex, Fed cuts to 3.00-3.25%, and broadening earnings — bull 8,200, bear 6,800.
Silver targets $95 by Q3 2026 as the gold-to-silver ratio compresses from 59 toward 50 on Fed easing and gold's $5,000 path — base, bull, and bear cases laid out.
EUR/USD targets 1.20 by Q3 2026 as the Fed cuts toward 3.00%-3.25% and the ECB weighs a June 11 hike, compressing the transatlantic rate differential.
USD/JPY at 159 with the Fed-BOJ differential at ~325 bp. The base case to 152 by year-end rests on Fed cuts, BOJ hikes, and 4–6 yen of compression-driven strengthening.
Gold to $5,000/oz by year-end 2026 in the base case — the September FOMC dot-plot reset and 60-tonne-per-month central-bank buying remain the load-bearing catalysts.
WTI base case $85/bbl by July 31 2026 from $102.27 spot. Iran framework + UAE-OPEC exit compress geopolitical premium; Goldman cuts Q2 to $87.