MUFG expects the EUR/USD pair to drop below parity.

In a memorandum published by the Japanese financial group MUFG, analysts stated that they expect the EUR/USD pair to fall below parity in the near future, following the re-inauguration of elected President Donald Trump on January 20. According to the MUFG memorandum, the euro is expected to be significantly impacted by the tariffs that Trump will impose on imports from the eurozone to the United States, as the group indicates that the effects of these tariffs are likely to hit the euro quickly. The key points mentioned by analysts at MUFG in the memorandum are: - There is now a nearly certain possibility that Trump will impose the trade tariffs he pledged to implement after his inauguration. - Trump is likely to move quickly to implement the tariffs, which will probably have an immediate impact on the euro. - Downward pressures on the euro are expected to increase due to weaker economic forecasts for the eurozone compared to those for the United States. - The lack of an increase in the value of the euro by the end of 2024 indicates that traders are not inclined to take profits from short selling the euro.