Euro: Range consolidation against US Dollar as growth gap narrows – Societe Generale

Societe Generale's Kit Juckes reports that EUR/USD has retraced 50% of its drop from above 1.20 to 1.1325 and is now fluctuating in a range as traders await new US economic data. The recent revision of 2026 US growth forecasts from 2.3% to 2.1% in the US, and Eurozone forecasts up to 0.8% from 0.5% in the Eurozone, highlights the relative rates tracking relative growth expectations.

The dollar remains tentative, waiting for soft US employment and retail sales data from July to confirm its direction. While the US growth outlook has been slightly revised downward, Eurozone growth forecasts have been cautiously improved. The article suggests that unless US growth expectations worsen, EUR/USD is likely to remain within its current range unless a significant market shift occurs.