Citi strategists expects EUR/USD falling to 0.86

Companies having extensive international presence keep meeting obstacles created by the U.S. dollar remaining strong. The EUR/USD currency pair has been remaining below parity for several weeks already, and analysts believe the record lows for the last 20 years might be soon renewed due to interest rate increase.

As it was stated by Citi strategists, there’s a fair chance that the U.S. dollar hasn’t reached its highest levels yet, so the EUR/USD falling is expected to continue until the level of 0.93 is reached. The company’s foreign exchange analysts don’t rule out the possibility of the major hitting the level of 0.86 in case the macroeconomic factors get stronger.

According to their words, the strengthened national currency is affecting the U.S. assets negatively in all possible aspects. Although the dollar’s impact on the economy should be taken under control, prices of various assets will probably fall under the influence. Experts forecast the dollar’s basis to get wider, which suggest negative correlation with those assets that are considered to be risky. US equities’ earnings are also expected to decline because of the dollar being so strong.