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Wall Street’s biggest banks are expecting the euro to fall to parity with the US dollar, as the war in the Middle East threatens to push up the price of Europe’s imported energy and higher borrowing costs weigh down on eurozone growth.
JPMorgan has downgraded its forecast for the euro to $1 by the end of the year. Citibank said it is targeting a move to parity “within six months” given its “ongoing view of European recession well ahead of the US”.
The calls put the US banking giants at the forefront of a growing group of lenders forecasting that the common currency’s steady decline since the summer has further to run.
The euro, which is at present trading at $1.0530, has already fallen about 6 per cent against the greenback since its peak in…
