The euro could fall against the dollar in coming months as the German government
remains reluctant to bow to pressure to increase fiscal spending to boost its
sluggish economy, Rabobank says. If the government raised fiscal spending, the
euro would "undoubtedly find support" but as it stands the currency could
"falter moderately" in the near term, Rabobank's Jane Foley says. Persistently
low inflation also increases the risk of further monetary policy easing by the
European Central Bank, adding pressure on the euro, she says. Rabobank expects
EUR/USD to end 2020 around 1.13, up from 1.1138 currently, but this is based on
the assumption the Federal Reserve cuts interest rates later in 2020.
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