Over the current quarter, the euro has fallen about 2% to $1.15. In March, it lost 2.5% compared to the previous month, which was the most significant decline since July. In late January, the euro reached its highest level in nearly five years, breaking the $1.20 mark. However, Morgan Stanley strategists led by David Adams predict a further decline to 1.13 dollars in the near future.
The rise in oil prices to 115 dollars per barrel and the closure of the Strait of Hormuz by Iran are causing fears reminiscent of the situation in 2022, when the beginning of the conflict between Russia and Ukraine led to a blow to European markets and the strengthening of the dollar.
In a matter of weeks, the market has moved from optimistic forecasts for the euro to more pessimistic ones. and options contracts are predicting the exchange rate to fall below $1.2 by the end of the year. Demand for protection against a weakening euro has reached a four-year high, with bearish bets prevailing four times over the yen, pointing to the “worst quarter” since 2024, reports ProFinance.Ru.
