Deutsche Bank ups EUR/USD forecast – A sharp change

Following Draghi’s hawkish remarks delivered on Tuesday, analysts at Deutsche Bank upped their forecast for EUR/USD for 2017, a sharp change from previous forecasts.

Key Quotes:

“We are completely revising our euro outlook for the rest of the year”

Draghi's speech (Tuesday) is "not the fundamental driver behind the change in view" but that it  "aptly marks the culmination of a number of developments" that have prompted the bank to switch gear

“EUR/USD to rise to $1.16 or above by the end of the 2017 versus 1.03 previously projected”

“Euro is likely to be the key vehicle via which financial conditions in the Euro-area will be tightened”

“This could well mean that, like the Fed's exit, the ECB is unable to tighten as much as it thinks”